Oil Prices Climb Near $100#
Oil prices experienced a significant increase during Asian trading on Thursday, approaching the notable $100 per barrel mark. This surge was triggered by reports of two oil tankers being attacked in Iraqi waters, raising concerns about potential disruptions in oil supply.
Impact of the Iraq Tanker Attacks#
Brent crude oil futures jumped over 7%, reaching $99.54 per barrel at the market's opening, before settling at $98.23 per barrel later in the day. Meanwhile, West Texas Intermediate (WTI) crude futures rose by 6.9%, hitting $92.04 per barrel. The attacks occurred in the northern Persian Gulf, close to Iraq and Kuwait, with footage showing the tankers ablaze. Iraqi media outlets have attributed the attacks to Iran.
Ongoing Conflict and Supply Concerns#
These incidents come amid escalating tensions in the ongoing conflict between the U.S. and Iran, which has now entered its thirteenth day. The situation has heightened fears of supply disruptions, particularly as Iran has threatened to block oil shipments through the Strait of Hormuz, a crucial passage that handles about 20% of the world's oil supply.
Global Responses to Potential Supply Shocks#
Despite the rising oil prices, they have not reached their weekly highs due to efforts from several countries to mitigate potential supply shocks. The International Energy Agency is reportedly preparing to release a record 400 million barrels of oil from its strategic reserves this week. Additionally, U.S. President Donald Trump announced plans to release 172 million barrels from the Strategic Petroleum Reserve to help cushion the impact of the conflict on energy prices. Despite these measures, the situation remains tense, with little indication that the conflict will de-escalate soon.