Crude oil prices have risen rapidly in the international market as the conflict in the Middle East intensifies. On Wednesday (September 9th), the price of Brent crude exceeded $100 per barrel, which is the first since July 24.
Brent futures rose by 2 decimal $15 per cent or 2 decimal to $107. At the same time, the price of U.S. WTI crude oil rose by $70 per cent, or 83 per cent, to $73.
The main reason for the rise in oil prices is the threat of further conflict in the Middle East. The attack on Saudi Arabia’s energy facilities, especially the Iranian-backed Houthis, has raised concerns about the supply of the global market. Several establishments in southern Saudi Arabia have been reported to have been temporarily shut down.
In addition, the risk of fuel transport disruptions in the Red Sea and the Straits of Hormuz has also put pressure on the market. If the conflict is prolonged, the global supply crisis could intensify by damaging oil production, conservation and transportation infrastructure.
In this situation, some major investment banks, including Goldman Sachs, Bank of America and HSBC, have increased oil prices forecasts. According to market analysts, if the price of oil is above $100 for a long time, the cost of transport, power and industrial production increases as well as inflationary pressures around the world.
Brent exceeded the $100 limit, but the next transaction fell slightly. However, there are fears of further price hikes in the market as the Middle East conflict and the risk of important energy transport continues.