US-Israel-Iran War Latest News: Renewed Strikes Raise Supply Concerns
The recent attack by the US on Iran has brought more attention to civilian deaths as well as the supply of energy. The health minister of Iran reported that 18 civilians died and 108 others were injured during Tuesday’s US attack on Iran. The casualties were recorded due to the attack in an area near the Strait of Hormuz where a wedding ceremony was taking place. The attacks by the US on Iran are considered to be the largest since July. The ongoing war has already lasted for seven months.
US-Israel-Iran War Latest News: Why Are Oil Prices Near $95?
Oil prices continued to be volatile in anticipation of more supply disruptions. In yesterday’s trading session, both WTI and Brent traded up by about $2 per barrel, but fell by $1 per barrel. The two benchmarks had reached their highest point since July 24th in yesterday’s session. But prices were lower today after speculations arose about the likelihood of the current military action resulting in disruption of global oil supply in the long run. Although the price has fallen, Brent is still near $95 per barrel, maintaining high energy prices in comparison to before the latest escalation.
US-Israel-Iran War Latest News: Strait Of Hormuz Traffic Falls
Energy markets have paid significant attention to the Strait of Hormuz due to its strategic position with regards to global oil shipments. As per preliminary shipping numbers, just six ships carrying commodities sailed through the strait on Wednesday. This was lower compared to 11 ships recorded the previous day and considerably lower than the average number of vessels that sailed through the region over the past 10 days, which stood at around 13 ships. Reduced shipping activity is yet another reason why fears have arisen that any prolonged tensions will lead to reduced shipments of crude and other commodities through the strategically important strait.
US-Israel-Iran War Latest News: Iraq Increases Oil Exports
Oil exports from Iraq have increased, supplying the international oil market with some extra supplies despite worries about disruption in other parts of the region. Crude oil exports from Iraq jumped to 2.34 million barrels per day in August from 1.35 million barrels per day in July, reported by Iraqi energy officials. The Iraqi exports are set to increase even more in September. Discounts and permission granted by Iran for Iraqi oil tankers to pass through the Strait of Hormuz have been encouraging oil purchases and increasing supplies.
US-Israel-Iran War Latest News: Fed Rate-Hike Bets Add To Market Pressure
Oil prices are also under close watch of the market due to the possibility that oil price increases will contribute to inflation. Inflation may limit the ability of central banks to lower interest rates. The market is currently looking for any possibility that interest rates may be raised by the Federal Reserve in September. This creates additional uncertainty for market players, who are facing risks associated with geopolitics and unstable energy prices. Interest rate increases may affect economic growth and the performance of the market because of increased cost of borrowing.
US-Israel-Iran War Latest News: What Could Happen To Oil Prices Next?
The future trends in oil prices will be greatly influenced by events related to the US-Iran conflict and the status of the Strait of Hormuz. On the one hand, any long-term disruptions to shipping and/or additional attacks on oil infrastructure would lead to an increase in oil prices.
On the other hand, the increase in exports from Iraq and the indications that the current military escalation would be of limited nature should mitigate the impact of price growth. At present, market players take into consideration both the threat of supply shortage and the fact that oil prices have already priced in a geopolitical risk premium.
