Trump's Iran Sanctions Threat Sends Oil Prices Soaring
Oil prices are expected to end the week on a high note, with international and US crude futures rising after US President Donald Trump's threat of economic sanctions on Iran's trading partners. Brent crude futures settled at $94.39 a barrel, up 61 cents or 0.65%, while US West Texas Intermediate crude settled at $87.06 a barrel, up 23 cents or 0.26%.
The price increase comes as the US has ramped up pressure on Iran, with Trump pledging to impose the toughest financial penalties in history. In response, Iran said its reaction would be 'devastating' if new US threats materialize.
Analysts note that while the immediate impact of supply may be limited due to existing constraints on Iranian exports, an increase in shipping incidents and retaliation against economic sanctions could exacerbate the situation.
Pipeline workarounds and alternative supplies are being found, with Phil Flynn from Price Futures Group saying 'Hormuz is still a problem, but it is no longer the only story.'