The prospects of another military conflict in the Middle East are very, very high.
This is the news we woke up to this morning. U.S. – Iran tension is obviously getting higher, but that’s not the only thing rising. Brent oil prices climbed around 5% last week - this is the opportunity we’d rather talk about. Benchmark Brent crude futures settled at $64.86 a barrel, losing 0.5%. U.S. crude futures settled at $57.90 a barrel, rising 0.8%.<
Price of crude oil for the past 5 years
Like prices of other commodities, the price of crude oil has experienced wide fluctuations during the years. Economic and political crises are among the most influential factors that can disrupt the oil prices. If we go far back to 1979 and 1980, events in Iran and Iraq led to another round of crude oil price increases. The Iranian revolution resulted in the loss of 2.0-2.5 million barrels per day of oil production between November 1978 and June 1979. At one point production almost halted.
Nobody knows for sure whether and how the current situation will be resolved. Chances of a conflict are at least 50% right now, Fesharaki said. It may not be a “full war,” he pointed out, “but conflict which would disrupt (energy) supplies.”
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