Oil prices rise as hundreds of tankers are blocked in the Persian Gulf
5 March 10:25
Oil prices continue to rise on Thursday, adding more than 3% amid direct military escalation between the US, Israel, and Iran.
This was reported by Reuters, according to "Komersant Ukrainian".
The price of Brent crude rose by $2.65 to $83.99 per barrel. US West Texas Intermediate (WTI) crude rose by $2.76 to $77.42.
Blockade of the Strait of Hormuz
Markets remain tense due to risks to shipping in the Strait of Hormuz, which supplies one-fifth of the world’s oil and gas consumption.
The current activity of Iranian forces directly threatens the security of maritime trade routes, forcing traders to factor the risks of prolonged destabilization into prices.
The escalation has moved into a phase of direct combat after a US submarine destroyed an Iranian military vessel and NATO systems intercepted a ballistic missile over Turkey.
Domestic political changes in Iran, in particular the nomination of the son of the late supreme leader as his successor, indicate Tehran’s unwillingness to make concessions. The fifth day of the US and Israeli military campaign has already caused numerous casualties and chaos in the financial markets.
Production crisis
Energy production in the region is suffering significant losses. Iraq has been forced to cut production by 1.5 million barrels per day due to the lack of export routes.
At the same time, Qatar has declared a force majeure on liquefied natural gas exports, predicting that it will take at least a month to resume supplies.
MarineTraffic data confirms that hundreds of tankers and cargo ships remain anchored in the Persian Gulf, unable to pass through dangerous areas.
China’s response
The Chinese government has begun to take emergency measures to protect its own energy balance, calling on companies to suspend exports of refined fuel and cancel existing contracts.
Oil traders remain optimistic about further price increases. In their opinion, a quick diplomatic solution to the conflict seems unlikely, which will keep raw material prices high in the near future.
