Oil traders cannot accurately price this conflict. Six consecutive days of intense fighting between Israel and Iran have thrown global energy markets into complete uncertainty, and no one on Wall Street or in the Gulf can predict how severe it will be.
No one has a clear prediction. No analyst is confident enough to provide an accurate number. The longer the situation lasts, the harder it becomes to predict oil prices for next week, or even next month.
Israel launched a surprise bombing of Iran's military and nuclear infrastructure last Friday. As a result, Tehran retaliated with a regional-scale air campaign.
On Tuesday, President Donald Trump, from the White House, called for "unconditional surrender" from Iran and warned that "U.S. patience is running out." Just hours later, Supreme Leader Ali Khamenei threatened "irreparable damage" if the U.S. engages militarily.
Gas under attack, supply risks, maritime strategy in Hormuz.
Iran has fired missiles at Israel's Bazan oil refinery, while Israel retaliated at South Pars, the world's largest gas field located between Iran and Qatar. Tehran has temporarily suspended most production activities. The market is acutely aware that this situation is no longer hypothetical; the energy flow is being disrupted.
The market is now paying attention to the Strait of Hormuz, a critical point connecting the Persian Gulf to global oil supplies. If Iran blocks this route — a possibility that is no longer hypothetical — the consequences will immediately ripple worldwide. Oil prices will soar.
John Evans, an analyst at oil brokerage PVM, noted that market sentiment is a "layer of concern." In a note on Wednesday, John warned that traders are trying to operate in a world where "missile conflict is common," while also warning that this conflict could escalate faster than expected.
Leadership positions at energy corporations such as Shell, TotalEnergies, and EnQuest are closely monitoring the situation. Subsequent attacks, especially aimed at infrastructure, will damage global supply and make fuel prices even more volatile. Currently, everyone is living in a defensive state.
Oil prices react instantly minute by minute. Brent for August rose by 0.3%, reaching 76.69 USD per barrel at noon on Wednesday in London. West Texas Intermediate (WTI) for July increased by 0.5%, reaching 75.25 USD per barrel. Although not large, the increases are steady, and in a geopolitical crisis like this, consistency is a red warning.
Analysts are trying to simulate chaos as the USD remains stable and the Fed prepares.
Per Lekander, founder of Clean Energy Transition, stated that the recent rise in oil prices has not changed the larger bearish picture. Before the attacks, the market was pushing down to a low of 30 USD to 50 USD per barrel due to excess supply from OPEC and weak global demand. Now, producers are ramping up extraction and hedging to cope with deeper risks.
"I increasingly believe that we are heading towards a sharp decline in 2014/2020, to the range of 30-50 USD," Per shared. "The current conflict clearly indicates that this possibility is even higher, especially as producers race to extract and hedge to cope with new risks." Furthermore, current prices already include a risk premium of 10 USD due to disruptions from Iran — especially reduced exports and slower tankers.
Stephen Schork, editor of The Schork Report, gives a sharper perspective. On CNBC, he warns that the market is "waiting for new news." "Anyone hoping for stability today is playing a game of chance based on hope, not reality."
He compares the current threat to Iraq's invasion of Kuwait in 1990 or the oil embargo of 1974. He estimates a 5% chance that oil prices will exceed 103 USD per barrel within five weeks and may even reach 160 USD before summer ends — but only if the Persian Gulf is completely disrupted.
As the war drags on, the market continues to fluctuate. On Wednesday, Brent prices rose during Asian hours, fell back in Europe, then rose again by 0.2%, reaching 76.61 USD per barrel. No clear trend is evident; only a recurring state of panic.
Meanwhile, the U.S. economic data is not very encouraging. On Tuesday, retail sales fell by 0.9% in May — the biggest drop in four months. The labor market is also weaker. All of this puts the Federal Reserve in a difficult position.
Source: https://tintucbitcoin.com/chuyen-gia-anh-huong-xung-dot-israel-iran-den-dau-tien-dien-tu-con-chua-ro/
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