Oil Markets: Brent Reaches $117 Amid Tehran Threats
Iranian officials stated they would target Gulf energy infrastructure if a joint US-Israeli offensive begins, while US State Department ordered some personnel to leave Saudi Arabia.
By Noah Rao ·
Middle East tensions pushed oil to its highest level since April, with Brent crude rising 3.5% on Friday to briefly surpass $117 a barrel before settling just over $116.
The price jump followed statements from Tehran regarding potential targets for retaliation. Iranian officials indicated that if a new joint US-Israeli offensive were launched, the country would strike back against oil facilities, undersea cables, data centers, and artificial intelligence infrastructure located in the Gulf region. Market analysts suggest the increase was also driven by reports that the United States is considering renewed military strikes on Iran, with plans appearing to be timed for after the midterm elections. Richard Hunter, a broker at Interactive Investor, noted that this shift was sufficient to cause a spike in prices, observing that what many initially viewed as a brief conflict is now entering its eighth month.
The current price reflects a sharp rise from February, before the war with Iran began, when Brent traded at approximately $72 per barrel. By the end of April, tensions had driven the price up to touch $126 per barrel.
The Islamic Revolutionary Guards Corps in Iran claimed to have struck four commercial ships in the Strait of Hormuz on Wednesday. The strait is a critical chokepoint for global oil shipments, and Susannah Streeter, the chief investment strategist at Wealth Club, stated that the journey remains dangerous due to projectiles still being fired at maritime traffic.
In response to the rising instability, the US State Department issued orders for some diplomats and the families of US government employees to leave Saudi Arabia. The kingdom has faced continued attacks from Houthi rebels based in Yemen.
Streeter noted that fears are mounting that American and Israeli forces may be ordered to target Iran's energy infrastructure after the US elections on November 3, and that Ukraine's bombardment of Russian diesel refineries is also impacting the global energy supply.
Source: The Guardian
