oil derrick, oil prices, oil market
(Houston, TX) – Energy experts say the ongoing Israel-Hamas war has the potential to send oil prices higher while further restricting the world’s oil supply as a whole. Dating back to the Ukraine-Russia war, oil prices have come under pressure — particularly given the Biden administration has been opposed to increasing domestic production here in the US.
The oil-rich Middle Eastern region is now experiencing geopolitical unrest amid the war between Israel and Hamas, and traders have responded. Brent crude futures, which is considered the global benchmark, are trading up near $90 a barrel. In the short term, speculation that the region could continue to see escalating military conflict could push that price up to $100 per barrel.
Digging in further, there’s the potential for Iran to become involved, given general hostilities with Israel — and the fact Tehran has sponsored Hamas and Hezbollah. To date, Hezbollah — located in Lebanon — has not become heavily involved in the current conflict. Should Iran’s involvement become expanded, as many as 20 million barrels per day could be disrupted — as shipping could be affected in the Straits of Hormuz. A vital shipping artery for the globe’s oil supply, linking the Persian Gulf to the Gulf of Oman, the Straits of Hormuz are controlled by Iran.
