Oil Prices Soar on Renewed US-Iran Strikes and Record Diesel
Oil prices rose on Friday, ending the week substantially higher after renewed US-Iran strikes and diesel hitting a record high. Brent crude futures settled at $92.68 a barrel, up 76 cents or 0.8%, while West Texas Intermediate crude finished at $91.48 a barrel, up 18 cents or 0.20%. The rally in oil prices combined with a steep increase in fuel prices has pushed inflation and government borrowing costs higher around the world.
The average US diesel price hit a record high of $5.85 per gallon, according to AAA data. Claudio Galimberti, chief economist at Rystad Energy, stated that all sectors of the economy are affected by diesel, contributing to high government bond yields in the United States due to expected continued inflation.
Citi raised its average Brent crude price forecast for the third quarter to $86 a barrel from $80, citing the longer-than-expected reopening of the Strait of Hormuz. ANZ analysts also increased their short-term Brent crude forecast to $95 a barrel with upside risk if the Middle East conflict intensifies.