Projections are that oil could rise even further if Iranian infrastructure is hit. (Image: iStock/vadimrysev)
The tension in Middle East has been experiencing an escalation in the last two weeks with the bombings of Israel against the Lebanonwith the justification of attacks against Hezbollah. In retaliation, the Iran began attacks against the Israeli state.
Concern about the region is putting pressure on oil prices oil. The Brent type, which is an international reference, advances 3.86% at around 12:20 p.m., reaching US$76.71 per barrel. WTI rooms 4.45%at US$73.94 per barrel.
And projections are that the commodity could rise even further if Iran's oil infrastructure is hit. It is worth remembering that Iran is the eighth largest oil producer in the world, with a production of 3.9 million barrels per day.
Bjarne Schieldrop, chief commodities analyst at the Swedish bank SEBhighlights that crude oil futures could rise to US$200 a barrelor more, in a scenario of destruction of Iran's infrastructure.
“If you took away the oil facilities in Iran and forced exports down by 2 million barrels, then the next question in the market would be what would happen in the Strait of Hormuz? This, of course, would add a significant risk premium to oil,” he said in interview with CNBC.
Located between Iran and Oman, the Strait of Hormuz it is a strategically important waterway for the flow of crude oil in the Middle East to the main markets in the world. Iran could close this passage, disrupting the supply of the product.
“It all depends on how the conflict escalates further, and I think it goes without saying that Israel will retaliate after the latest Iranian attack — and that will happen in about five days, probably, before the one-year anniversary on the 7th of October (day of Hamas attack on the music festival in Israel)“, completed Schieldrop.
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