Economic and business sources have revealed that oil prices have stabilized after a 4% increase due to the shocks in the oil market related to the ongoing exchange of attacks between Iran and Israel. U.S. President Donald Trump is currently considering joining Israel in attacking Iran. If Trump decides to join Israel, experts in business and economics believe that the situation in the Middle East will further deteriorate, causing a major disruption to oil supplies.
The main benchmarks used to determine oil prices in the global market are Brent Crude and West Texas Intermediate crude oil barrels. On June 18, the price of a Brent Crude barrel rose by 0.2% to $76.61. Similarly, the price of a West Texas Intermediate barrel also increased to $75.01, a 0.2% rise. However, market analysts noted that this was a 1% decrease compared to the previous day’s trading session.
“The biggest concern for the oil market right now is the disruption of travel in the Strait of Hormuz,” said the Netherlands’ ING Bank, which analyzes the oil market. “One-third of the world’s daily oil consumption is transported through that [Strait of Hormuz] route. If operations on that route are disrupted, the price of [an oil barrel] could suddenly rise to $120.”
Iran is the third-largest oil producer among OPEC+ countries. Iran supplies 3.3 million barrels of crude oil to the global market daily. Iran has warned that it will take dangerous measures in retaliation if the United States decides to join Israel in attacking Iran.
These measures include disrupting travel through the Strait of Hormuz. Ali Bahraini, Iran’s ambassador to the United Nations offices in Geneva, said that Iran has warned Washington that it will take dangerous measures if Israel joins in attacking Iran. If Iran acts as it has warned, market analysts believe there is a risk of a major shock to the oil market, with prices rising to unpredictable levels.
