Oil Prices Soar on Mideast Supply Fears and Fed Rate Hike Expectations
Oil prices surged on Monday due to concerns over supply disruptions in the Middle East. The rise was triggered by Saudi Arabia's closure of a key pipeline, the Petroline, which has a daily capacity of 7 million barrels. This move comes amid escalating tensions between Iran and Arab countries.
The price of November-delivery Brent crude oil rose by 2.6 percent to $107.3 a barrel. The US consumer price index (CPI) also showed a 0.4 percent monthly increase in August, with core inflation defying estimates at 0.3 percent month-on-month.
The Federal Reserve's interest rate decision this week is expected to be influenced by these developments. Market estimates suggest an 87 percent probability of a rate hike following strong employment data and rising inflation forecasts.