Commodities
Oil Prices Surge as US-Iran Tensions Escalate, Emergency Reserves at 43-Year Low
The price of West Texas Intermediate (WTI) oil has risen to $83.33 per barrel, up 1.45% from yesterday, as tensions between the US and Iran continue to escalate.
Hopes for a US-Iran agreement to fully reopen the Strait of Hormuz have faded, with President Trump introducing new demands on Tehran, including compensation for people killed in conflicts.
The US Emergency Reserves are at their lowest level since 1983, with only 300 million barrels held in reserve. This has raised concerns about the ability of the US to absorb a supply shock if the Hormuz closure persists.
The spread between Brent and WTI is currently $5.56, or 6.7% of WTI, which reflects the increased risk premium due to Middle East supply disruptions.