As Middle East tensions threaten a wider conflict, Oil prices to remain elevated
Key Points:
- Dhar forecasts that Brent Oil will be trading in the range of $75 to $85 per barrel in September due to diminishing prospects of a truce in Gaza and an expected Iranian retaliation against Israel.
- “Israel’s response may include an attack on Iran’s oil supply and related infrastructure, which would put at risk 3% – 4% of global oil supply,” said Vivek Dhar, mining and energy commodities strategist at the Commonwealth Bank of Australia.
- Cedric Chehab, managing director and head of global risk at research firm BMI, said the exchange of fire on Sunday does not mean that an ‘all-out war’ is imminent.
Tensions in the Middle East and the possibility of a larger conflict will keep oil prices high, according to Vivek Dhar, mining and energy commodities strategist at the Commonwealth Bank of Australia.
Oil prices increased on Monday after Israel’s Air Force hit targets in Lebanon with over 100 fighter jets, followed by an Iranian-backed militia firing over 320 rockets into Israel.
U.S. West Texas Intermediate crude increased 0.75% to $75.39 per barrel, while Brent crude rose 0.67% to $79.55.
