Oil Price Rises as US Says Israel Has Struck Iran

Oil Price Rises as US Says Israel Has Struck Iran - Merchant Navy Info - News

Oil and gold prices rose after US officials said an Israeli missile hit Iran. International benchmark Brent crude rose above $90 a barrel after reports. Of an Israeli attack but fell as Iran sought to downplay its importance. Gold briefly neared all-time highs but has since settled below $2,400 per ounce. There are concerns that the escalating conflict in the Middle East will affect oil supplies. Over the weekend, 4,444 investors were closely monitoring Israel’s response. To direct Iranian drone and missile attacks. Crude oil prices initially rose by up to 3.5%. However, Brent fell to $87 per barrel after Iranian state media claimed that there was “no damage” in Isfahan province. Where the explosion had been reported. 

A rapid and sustained rise in oil prices risks increasing inflation. Countries are highly dependent on raw materials used to manufacture fuels such as gasoline and diesel. Fuel and energy prices have been a major driver of rising costs of living around the world in recent years. Randeep Somer, fund manager at  M&G Investment Management, told the BBC’s Today program: The rate remains above the Bank of England’s 2% target, with some economists predicting a rate cut may not occur until the summer or the end of the year. “Inflation in the UK remains at around 3.2%, still far from the target, but it is starting to be a cause for concern for policymakers,” Somer said. It is good  that the situation has not worsened further and that  the disruption to the market is expected to be short-lived.” Major economies have imposed sanctions on oil-producing countries.

Price Hike

Oil prices reached $125 per barrel in the following weeks, which led to its duration. Gold prices often rise during times of uncertainty as it is considered a safe investment. Escalating tensions in the Middle East have raised concerns that shipping through the Strait of Hormuz between Oman and Iran may be affected. It is an important shipping route through which approximately 20% of the world’s total oil volume passes. The members of the OPEC oil cartel (Saudi Arabia, Iran, United Arab Emirates, Kuwait, and Iraq) send most of their oil exports through the strait. 

According to the U.S. Energy of Information Administration, Iran is the world’s seventh-largest oil producer and third-largest OPEC member. Vandana Hari, an energy market expert at  Vanda Insights, said the  initial rise in oil prices was “an inevitable response to concerns that the war between Israel and Iran could escalate again.” “Recent events have highlighted the growing fragility and instability of the situation in the Middle East,” she added. The stock market fell as investors reacted to recent events. In the UK, the FTSE100 stock index was down 0.5% in early trade, while the FTSE 250 index was down 0.8%. In Asia, Japan’s Nikkei 225 index fell by 2.7%, and Hong Kong’s Hang Seng index fell by 0.9%. South Korea’s Kospi closed 1.6% lower.

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