Oil Prices Plunge Amid Washington's 'Economic Asphyxiation' of Iran
The global oil market pulled back on Monday as Washington imposed severe sanctions against Iran. Brent crude fell by about 1.7% to $92.76 per barrel, while West Texas Intermediate (WTI) dropped 2% to $85.29 per barrel.
The decline in oil prices was attributed to profit-taking amid the uncertainty surrounding the sanctions. Traders were reportedly reducing positions as they awaited further developments from US Treasury Secretary Scott Bessent's announcement of additional economic measures against Tehran.
Bessent unveiled 'Operation Economic Outcast,' which targets five of Iran's key lifelines: digital assets, technology, gold, aviation, and shipping. He stated that this is the 'economic asphyxiation' of the regime, with China being included in the strategy of penalizing countries that help Tehran evade sanctions.
Australia's Commonwealth Bank echoed mixed sentiments about the efficacy of the sanctions in collapsing the Iranian economy. It noted that while the measures could be effective, they also increase the risk of Iranian retaliation and violence, which would impact energy markets.