Brent crude oil prices exceed $100 for the first time since July
As a result of developments triggered by the war between the US and Iran and supply risks in the Strait of Hormuz, Brent crude futures climbed to $100.6, returning to triple digits.
While a triple-digit price period begins once again in the oil market after months, Brent futures rose up to $100.6, surpassing $100 for the first time since July. The US-Iran war and supply risks in the Strait of Hormuz directly influenced this global rally.
Strait of Hormuz and supply risks
The possibility of the war between the US and Iran expanding played a decisive role in the new leg of the rally in the markets. While Iranian-backed Houthi attacks on energy facilities in Saudi Arabia created a new supply risk, the US striking Iranian tankers and Tehran's response escalated tensions around Hormuz.
Significant disruptions in maritime traffic
Before the war, it was estimated that approximately 20 million barrels of oil passed through the Strait of Hormuz daily. Due to tankers turning off their location signals and disruptions in maritime traffic, severe uncertainties exist regarding the actual flow volume.
Security premium added to the markets
These uncertainties add a permanent security premium to oil prices. Even if the markets cannot fully measure how much supply has actually decreased, they are forced to price in the possibility of a critical energy corridor being disrupted once again.
Strong braking factors suppressing prices
Weakening demand in China, the world's largest oil importer, can make it difficult for prices to remain in the triple-digit region. On the other hand, rising production by non-OPEC producers such as the US, Canada, and Guyana offsets some of the supply losses in the Middle East.
Two different scenarios for the upcoming period
The future direction of oil will largely be determined by the course of the war, and the upward revision of price forecasts by institutions such as Goldman Sachs, Bank of America, and HSBC indicates that risk has increased.