Middle East Tensions Skyrocket Oil Prices
Oil prices surged over 7% due to Israeli airstrikes against Iran, prompting fears of disruptions in Middle East oil supply. Both Brent and U.S. West Texas Intermediate crude soared to their highest since January. Concerns rise over the potential impact on the Strait of Hormuz, a critical oil passage.
In a dramatic turn of events leading to a surge in oil prices, tensions escalated on Friday as Israeli airstrikes were launched against Iran. This raised fears about potential disruptions in the supply of oil from the Middle East, a region crucial to global oil distribution, propelling oil prices to multi-month highs.
Brent crude futures rose significantly by 7.12%, reaching $74.30 a barrel, while U.S. West Texas Intermediate crude increased to $72.75. These gains are reminiscent of the 2022 energy price spikes following Russia's invasion of Ukraine, marking the most significant intraday movements since then.
Despite the tension, oil flow through the Strait of Hormuz has not been impacted yet, though the situation remains volatile. Analysts warn of severe economic consequences for Iran should it choose to close this vital oil artery, citing the potential for damaging its relationship with key trade partners, particularly China.
(With inputs from agencies.)
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