Oil market factoring in a higher risk premium

ING says the oil market is now factoring in a higher risk premium due to rising geopolitical tensions following Israel’s strike on Iran.

• uncertainty has increased significantly
• Iran produces around 3.3 million barrels of crude per day and exports around 1.7 million
• if tensions escalate, it’s not hard to imagine a disruption in Iranian oil flows

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I suspect the Strait of Hormuz might be a danger zone for a while now too, another tailwind for oil.

Brent update:

ps.

• New explosions and air-defense activity reported over the Iranian capital of Tehran
• another wave of strikes against the city by Israel

Earlier:

We got a 10 minute or so warning:

• Financial Times reports Israeli strike on Iran could come today, Friday 13 June

Then:

• Explosions heard in Tehran – reports are sketchy
• Israel says has launched a pre-emptive attack against Iran
• Market response to Israel attack on Iran: Yen up, Oil rockets higher.
• Israel’s Air Force conducted a strike in Iran – update
• Israeli official confirms attack on Iran – Iran’s nuclear program an ‘existential threat’
• Reports that Israel has detected missile launches from Iran
• Israeli PM Netanyahu- We targeted Iran’s main enrichment facility in Natanz
• Unconfirmed: Iranian jet fighters taking off, Iranian ballistic missile launches reported
• US warns Iran not to target U.S. interests or personnel
• Reports of another wave of Israeli strikes on Iran has begun

• Trump convenes the National Security Council meeting at 11am on Friday

Iran says Israel and America will pay a very heavy price

This article was written by Eamonn Sheridan at www.forexlive.com.