Oil Prices Soar as US-Iran Tensions Escalate
Crude oil prices surged over 2% on Monday in response to escalating tensions between the US and Iran. The price of Brent crude rose by $2.21 per barrel to $90.31 per barrel at the ICE Exchange's Comex division in London, representing a 2.51% increase from Friday's close.
The West Texas Intermediate (WTI) crude price also jumped by $1.83 cents to $85.23 per barrel at the Comex division of the New York Mercantile Exchange, marking a 2.19% rise from Friday's close.
The tension began on Sunday when the US military fired two rockets at Iran's Larak Island in the Strait of Hormuz, prompting Iran to retaliate by attacking two US air bases in Jordan, according to Iranian media reports citing the Revolutionary Guards.
US President Donald Trump claimed that Iran's main energy center, Kharg Island, was being destroyed, but no evidence of an attack was found. Suvro Sarkar, head of energy research at DBS, warned that 'we are seeing a greater possibility of limited clashes rather than a long-term escalation of conflict.'
Sarkar also predicted that until more clarity emerges about the situation in the Strait of Hormuz, crude oil prices can be expected to remain in the range of $85 to $95 per barrel.