Iran’s missile strike on Israel caused a jump in oil prices
2 October 2024 09:52
Oil prices jumped sharply on Wednesday, 2 October 2024, in response to the escalating situation in the Middle East after a large-scale Iranian missile strike on Israel. It is reported by "Komersant Ukrainian" with reference to Reuters.
Thus, futures for Brent crude oil rose by a full dollar, or 1.36%, to $74.56 per barrel. U.S. West Texas Intermediate (WTI) rose even more – by $1.07, or 1.53%, to $70.90 per barrel. It is worth noting that during yesterday’s trading, both benchmark crude oil grades showed even more impressive growth – by more than 5%.
This significant jump in prices was caused by growing concerns about possible disruptions in oil supplies from the region. Iran fired more than 180 ballistic missiles at Israel, which was Tehran’s largest military strike against the Jewish state. In response, Israel and the United States promised retaliation, which has raised serious concerns about further escalation of the conflict.
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Analysts emphasise that Iran’s direct involvement in the conflict, which is a member of OPEC, significantly increases the risks to the global oil market. This is especially important given that Iran’s oil production reached a six-year high of 3.7 million barrels per day in August.
Experts from Capital Economics warn of the possibility of an even greater price increase, noting that a significant escalation by Iran could draw the United States into a war. This would have serious consequences not only for the global economy but also for the energy sector as a whole.
Against the backdrop of these events, the planned meeting of OPEC ministers is of particular importance. This alliance of oil producers is expected to discuss the current market situation and possible measures to stabilise prices. As a reminder, OPEC plans to increase production by 180,000 barrels per day per month starting in December.
Experts point out that the current situation clearly demonstrates the high vulnerability of the oil market to geopolitical risks. This is particularly noticeable against the backdrop of previous fears of a decline in demand due to the global economic slowdown. Now, geopolitical tensions are playing a key role in shaping oil prices, which may have long-term implications for global energy security.
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