Brent Crude and WTI have both leapt two per cent following a report by Reuters that an Iranian tanker is ablaze in the Red Sea 60 miles from the Saudi port of Jeddah.
Iranian news agencies are reporting the tanker is ablaze and leaking oil into the Red Sea after being hit by two missiles. They are labelling it a “terrorist attack.
The obvious worry will be that this is a reprisal by Saudi Arabia following drone and missile attacks a few weeks ago on its own oil processing facility. The truth, of course, maybe far more straightforward than that. The Iranian tanker may well have just had a mechanical mishap causing the explosion rather than the spin put by the Iranian media.
The former though would represent a very dangerous escalation in the Middle East tensions across the Straits of Hormuz and if so oil prices could be set for a strong up move. At this stage, we will have to wait for more details to emerge.
Brent Crude and WTI spot are one dollar higher at $60.15 and $54.35 a barrel respectively.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities.
Opinions are the authors — not necessarily OANDA’s, its officers or directors. OANDA’s Terms of Use and Privacy Policy apply. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.
Recommended Content
Editors’ Picks
AUD/USD risks a deeper drop in the short term
AUD/USD rapidly left behind Wednesday’s decent advance and resumed its downward trend on the back of the intense buying pressure in the greenback, while mixed results from the domestic labour market report failed to lend support to AUD.
EUR/USD leaves the door open to a decline to 1.0600
A decent comeback in the Greenback lured sellers back into the market, motivating EUR/USD to give away the earlier advance to weekly tops around 1.0690 and shift its attention to a potential revisit of the 1.0600 neighbourhood instead.
Gold is closely monitoring geopolitics
Gold trades in positive territory above $2,380 on Thursday. Although the benchmark 10-year US Treasury bond yield holds steady following upbeat US data, XAU/USD continues to stretch higher on growing fears over a deepening conflict in the Middle East.
Bitcoin price shows strength as IMF attests to spread and intensity of BTC transactions ahead of halving
Bitcoin (BTC) price is borderline strong and weak with the brunt of the weakness being felt by altcoins. Regarding strength, it continues to close above the $60,000 threshold for seven weeks in a row.
Is the Biden administration trying to destroy the Dollar?
Confidence in Western financial markets has already been shaken enough by the 20% devaluation of the dollar over the last few years. But now the European Commission wants to hand Ukraine $300 billion seized from Russia.