“Given that the strikes appear to have been directed more at the Iranian military general staff, including the head of the IRGC and senior nuclear scientists, and that the US was not involved, that suggests that what we saw today was more of a pre-emptive strike and less of a sustained military conflict.”
International Response Pivotal to Near-Term Sentiment
However, Iran’s response and any retaliation from Israel could materially disrupt regional stability. While US-China trade tensions ease, China, Russia, and Iran’s regional allies could fuel further oil price gains.
While downplaying a broader conflict, Robert Rennie warned:
“Traders will, however, be super-focused on Iran’s response and how targeted it is on Israel, versus proxy attacks. Risks going into the weekend are very high, and a push above the January highs for crude is very possible.”
Despite this week’s events and the near-term threat of an escalation in Middle East tensions, Rennie had a more balanced view on the price outlook for oil, stating:
“Bigger picture, we remain of the view that, as we move into the third quarter, we will see prices probing the lower end of the $60 to $65 range, with risks of prices below $60 as we move into the fourth quarter.”
At the time of writing, after hitting a high of $74.615, WTI eased to $71.905, up 6.74%, as markets awaited Iran’s response.
https://www.fxempire.com/news/article/oil-price-news-crude-oil-soars-as-israel-attacks-iran-spiking-supply-concerns-1525798
