The price of oil rose by more than 2.5%, continuing yesterday's rally. The catalyst for this was increased concerns about escalating tensions in the Middle East, which could lead to disruptions in oil production in the region.
Iran said today that its missile strike on Israel is over if there are no further provocations, while Israel and the United States have promised to strike back at Tehran. Against this background, fears of a larger-scale war have increased. The UN Security Council has scheduled a meeting on the Middle East for today, and the European Union has called for an immediate ceasefire.
Experts said that further developments are likely to depend on Israel's reaction and whether it strikes military installations or Iran's oil industry. "Iran's or its allies' retaliation could strike Saudi oil facilities like in 2019 or see the closure of the Strait of Hormuz, while any of these events will trigger an oil rally," oil broker PVM experts warned. Iran accounts for about 4% of global oil production, and the key question is whether Saudi Arabia will increase production if supplies from Iran are disrupted.
Market participants are also preparing for the publication of a weekly report on oil reserves in the United States. Economists expect oil inventories to drop by another 1.25 million barrels last week after falling by 4.471 million barrels a week earlier. Yesterday, the American Petroleum Institute (API) announced that for the week ending September 27, crude oil inventories decreased by 1.5 million barrels.