Oil: Geopolitical risks reshape supply outlook – Rabobank

Rabobank’s Michael Every highlights that escalating US–Iran tensions and potential military action could have far‑reaching consequences for Oil markets and broader commodities. He notes that US strategic calculations, Iran’s threats to escalate, and Saudi contingency moves on production all point to heightened volatility. The report stresses that markets must look beyond simple Oil and gas price shocks to wider supply-chain disruptions.

Iran risk and supply contingencies

"This week also saw reported concerns an attack could involve US casualties and deplete munition stockpiles needed against contingencies in Asia. It would be a shocking error if either thought wasn’t front of mind before military pressure began: that points to underlying confidence in what the US has in store, and Iran doesn’t, or a gamble."

"Yet at this point the US cannot retreat without losing crucial global deterrence power: Iran is a military minnow compared to the States and any stand down would see supplies of Chinese weapons to Tehran step up so a repeat US exercise in years to come would be far more risky and/or unlikely."

"There’s a lot more for markets to think about than oil and gas, important and volatile as they are (as the Saudis boost oil output and exports for an Iran attack contingency, and Iran has ramped up oil tanker loadings for the same reason)."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)