The situation in the Middle East does not seem to be improving. The Strait of Hormuz is closed due to the US-Iran war and due to the blockade of the sea route by Houthi rebels for Saudi influence, concerns regarding exports through the Red Sea have reached their peak. The effect of all this is directly visible on the prices of crude oil, which is running at a fast pace and has now crossed 95 dollars per barrel.
This ongoing surge in oil prices has already taken global tension to a high, while a big warning has come from abroad regarding this, which is scary. In fact, Goldman Sachs warned that the Crude Oil Price could cross $120.
‘If this happens then oil…’
Due to the renewed conflict between America and Iran, there has been a lot of turmoil in the global oil markets this month. Till the time of writing on Wednesday, there was a sharp rise in the prices of crude oil in the international market and Brent Crude Oil Price was seen trading at $ 95.26 per barrel.
According to a Bloomberg report, investment bank Goldman, citing one of its notes, has said that if such disruptions in freight transportation through the Strait of Hormuz continue, then Brent will rise in the international market by the fourth quarter. crude oil The price may exceed $ 120 per barrel. Let us tell you that earlier in the month of March-April, when the US-Iran war was at its peak, the price of oil had touched the level of $120.
Hormuz-Red Sea increased the problem
Goldman analysts led by Dan Struven said oil prices rose sharply as tensions rose again in the Middle East and estimated oil flows from the Persian Gulf fell below 45% of pre-war levels. He said the risks to these projections are high for the oil price to exceed $120, which reflects the potential for continued disruption in the Strait of Hormuz and a crisis on exports in the Red Sea.
Risk of oil surge high
However, Goldman also expects the price of Brent to fall to $ 80 per barrel in the fourth quarter and to $ 75 per barrel next year in case of easing of tensions in West Asia. Let us tell you here that due to the closure of Hormuz Strait, the importance of Red Sea shipping has increased in delivering crude oil cargo to global buyers, but yemen The action by Iran-backed Houthi rebels in Saudi Arabia has increased concerns about this sea route.
“If the ceasefire does not hold, and Hormuz remains largely closed, while the threat from Houthi rebels to shipping in the Red Sea continues to grow, the risk of a significant surge in oil prices would be high,” George Lyon, chief geopolitical analyst at Rystad, was quoted as saying in Bloomberg’s report.
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