Oil Disruptions Continue
Oil extended its gains to lengthen a four-session hot-streak, thanks to rising tensions between Iran and Saudi Arabia and fears of potential supply-line disruptions. What a way to start a weekend…
A number of drone attacks on key Saudi oil facilities by Iranian proxies has kicked off a battle royale between the two oil giants, injecting a fair amount of uncertainty into the oil markets. A Saudi-led military coalition in Yemen responded with 11 targeted air-strikes on the Houthi stronghold in Sanaa, Yemen. Yikes!
The sudden escalation of tensions between Iran and Saudi Arabia has many analysts concerned about another devastating Middle-Eastern conflict and a widening rift in relations between Gulf member states.
Oil has ratcheted up 4.5% since Tuesday and may be primed for more upside as the escalating conflict shows no signs of easing up. An increase in violent conflict could further disrupt Saudi production and continue to tighten global supply, leading to more upward pressure on prices.
Investors will be eyeing up the OPEC+ meeting that will discuss the prospect of further supply cuts or increases. So far, supply cuts have helped buoy prices by more than 30% this year, despite President Trump’s best efforts to keep them as low as possible.
The oil market push and pull never ends!
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