US-Iran Tensions Send Oil Prices Soaring Amid Escalation Fears
The latest hostilities between the US and Iran have sent oil prices soaring as fears of escalation continue. The US struck three Iranian oil carriers on Saturday, prompting Tehran to retaliate with ballistic missiles against US ships.
Energy Secretary Chris Wright poured cold water on hopes for a nuclear deal, stating that 'there may not be' one. He also raised the prospect of a prolonged conflict, saying the US may need to destroy Iran's nuclear capabilities.
The ongoing tensions have tightened the crude market, with the IEA projecting a 4.3 million barrel per day decline in supply this year and expecting a deficit in the current quarter. Global inventories are at their lowest level since 1982, but will provide a floor for demand once the situation normalizes.