"If the conflict is prolonged and, in particular, if it affects actual oil supply, due to disruptions to Iranian supply or to Iranian attempts to block the Strait of Hormuz, it could cause oil prices to jump, perhaps to around $100 per barrel."
"The Strait of Hormuz, considered the most critical oil chokepoint in the world, is in focus amid Iran clash. A prolonged disruption to traffic in the strait, through which a fifth of the world's oil production is transported, could see oil prices breach the $100-a-barrel threshold."
Oil markets face significant volatility following US-Israel military strikes on Iran and Iran's retaliatory response. Although Iran produces only 3-4% of global oil, its strategic location near the Strait of Hormuz creates substantial market concerns. The strait, the world's most critical oil chokepoint, handles approximately one-fifth of global oil production. A prolonged disruption to shipping through this passage could drive oil prices above $100 per barrel, damaging the global economy and exacerbating existing inflation pressures. Brent crude surged 13% on March 2, the first trading day after strikes, before settling around $77 per barrel. Commercial traffic in the strait has nearly halted. OPEC+ announced production increases beginning in April to stabilize markets.
Read at www.dw.com
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