Iran-US Tensions Drive Oil Prices Higher Amid Supply Disruption Risks
Oil prices are rising as tensions between the US and Iran persist, threatening supply disruptions in the Middle East. The Brent crude oil futures contract is up 0.8% at $76.90 a barrel, while West Texas Intermediate (WTI) crude is up 0.6% to $72.54.
The recent escalation of hostilities between the US and Iran has put a premium on oil prices as tankers struggle to pass through the Strait of Hormuz. The International Energy Agency (IEA) warns that the conflict could undermine its forecast of an oil market surplus next year.
Vandana Hari at Vanda Insights notes that 'prices have backed off midweek highs, but there is still a substantial risk premium as Hormuz transits are back to a near-standstill with no clear signs of when normal reopening might resume.'