U.S.-Iran Conflict Expectations Shift Towards Prolonged Market Volatility

Market expectations have shifted towards a prolonged U.S.-Iran conflict, according to Standard Chartered Bank Energy Research Head Emily Ashford. She warned that the postponement of planned Hormuz shipping talks has ruled out de-escalation for now and damage to Saudi Arabia's East-West pipeline has impaired a key bypass route for the strait.

With supply buffers and alternative export capacity already tight, Ashford stated that the market is less able to absorb another disruption without a disproportionate price response. The Energy Research Head expects Brent oil to remain supported in triple-digit territory but warned that geopolitical headlines will continue to drive sharp corrections in both directions.

The pipeline closure and postponed talks have already kept Brent above $100 per barrel, with ICE Brent futures front-month rallying into triple-digit territory, moving towards $110 per barrel on September 14 and settling at $105.68 per barrel.