Oil Prices Surge Amid Middle East Tensions

Business » ENERGY | April 11, 2024, Thursday // 14:03
Bulgaria: Oil Prices Surge Amid Middle East Tensions @Pixabay

Oil prices have surged due to renewed concerns about the Middle East conflict. Brent crude futures increased by 0.32% to 90.80 USD per barrel, while American WTI crude rose by 0.3% to 86.50 USD per barrel. This comes amid fears of an Iranian strike on Israel following verbal threats by Iran in response to an Israeli attack on an Iranian diplomatic compound in Syria. Iran's Supreme Leader, Ayatollah Ali Khamenei, reiterated promises to retaliate against Israel. Despite this, Iran's navy chief indicated that the country would not block the Strait of Hormuz, a major oil trade route.

Iran, the third-largest producer in OPEC, exports about 3 million barrels of oil per day mainly to Asia. However, the latest round of ceasefire talks between Israel and Hamas has not yielded results. The surge in oil prices also defied data from the US Energy Information Administration (EIA), which showed a significant increase in domestic crude inventories. Additionally, US inflation data for March led to expectations of a delay in the Federal Reserve's rate cut.

Despite geopolitical tensions and OPEC+ supply cuts, which aim to stabilize the market, some predict further oil price gains. However, Macquarie Group predicts a potential decline in Brent prices in the second half of the year. Warren Patterson, head of commodity strategy at ING Groep NV, suggests that while geopolitical factors support oil prices, further appreciation may be limited without new catalysts or an escalation of Middle East conflicts.

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Tags: oil, prices, Middle East, Iran, Israel

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