The continuation of attacks between the United States and Iran once and for all blocked the Strait of Hormuz, through which around 20% of the oil produced in the world passed. Add to this the blockade of ships with Saudi Arabian oil by the Houthis – a Yemeni rebel group supported by Tehran – in the Bab el-Mandeb Strait, in the Red Sea, and the result is a new escalation in the price of fossil fuel. Which closed the session again above US$90, which had not happened for about a month.
Barrel oil returns to above US$90 with new tensions in the Middle East
The continuation of attacks between the United States and Iran once and for all blocked the Strait of Hormuz, through which around 20% of the oil produced in the world passed. Add to this the blockade of ships with...
An international reference, Brent oil due in September rose 2.01%, closing Tuesday (7/21) at US$91.01 per barrel. WTI (the US reference) scheduled for delivery in the same month rose 2.02%, to US$84.91 per barrel, details Valor.
With the conflict coming and going, the Persian Gulf petrostates allied with Washington are increasingly frustrated with the intensification of hostilities between the US and Iran, which increasingly puts their security and economies at risk, highlights Bloomberg. Despite the exasperation, the Gulf countries differ on what the Americans should do. While some advocate more aggressiveness, others, such as Qatar, the country that acts as a mediator in the conflict, want an immediate retreat in attacks on Iranian territory.
The war's negative economic effects on petrostates are illustrated by Saudi Arabia's oil exports. Saudi fossil fuel sales fell for the third consecutive month in May, reaching a record low, according to data from the Joint Organizations Data Initiative (JODI), Reuters reports. Exports fell to about 3.4 million barrels per day (bpd) in May from 3.98 million barrels per day in April. The drop occurred even with the recovery of the country's oil production, which reached 6.560 million bpd in May, recovering from the historic low of 6.316 million barrels per day, recorded in April.
The Saudis will now face an additional difficulty in their sales. The Bab el-Mandeb Strait is a key export route for the country and remained largely navigable throughout the conflict between the US and Iran, recalls CNN Brasil. Now, with the Houthis blocking the strait, two tankers transporting oil from the country to Asia reversed course in the Red Sea yesterday, according to Valor. Something that should continue to happen in the coming days.
In a statement, the International Energy Agency (IEA) warned of a growing risk to energy supplies following the escalation of war in the Middle East, Bloomberg, Xinhua and Reuters report. According to the Financial Times, the statement fueled speculation that the IEA is examining possible options if Hormuz is not opened quickly, including further releases of oil stocks by members.
Meanwhile, the bank Goldman Sachs warned that a barrel of Brent could reach US$120 in the 4th quarter if the interruptions in Hormuz persist, reports Valor.
Source: ClimaInfo
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