Oil Prices Soar Above $100 Amid Escalating Tensions in Strait of Hormuz
Oil prices surged to over $100 per barrel on Thursday as traders evaluated the risks associated with supply disruptions stemming from recent shipping attacks. Iran claimed responsibility for targeting ten vessels after the United States destroyed five tankers, and market analysts warn that if tensions continue in the Strait of Hormuz, oil prices could escalate further.
Tensions have been escalating in the region since the six-month-old conflict began between the US and Iran. The Islamic Revolutionary Guard Corps warned that it would intensify its response if further attacks take place. Brent crude futures were up 0.2% at $101.80 a barrel, while U.S. West Texas Intermediate crude gained 0.5% to $96.55 a barrel.
Analysts warn that the potential for further disruption is growing, with Goldman Sachs outlining a scenario in which oil prices could climb to as much as $120 a barrel if attacks on Middle Eastern vessels escalate. If exports return to normal, however, the bank expects oil prices to fall towards $80 a barrel.