U. S. oil prices jump 11% as Trump's address about the Iran conflict raises concerns of increased tensions
What’s happening:
Crude oil prices rose sharply as investors re-assessed the magnitude of supply risks from the ongoing Middle East war.
What happened:
What happened:
US President Trump pledged to increase attacks on Iran over the next weeks if the ceasefire conditions are not accepted.
Meanwhile, Iran is preparing a protocol with Oman to monitor traffic through the Strait of Hormuz.
Meanwhile, Iran is preparing a protocol with Oman to monitor traffic through the Strait of Hormuz.
US crude oil price jumps by more than 10%
Why it matters:
The ongoing conflict in the Middle East entered its fifth week, lifting energy prices after Iran closed the Strait of Hormuz route, which is responsible for transiting 20% of global oil and LNG (liquefied natural gas).
On Tuesday, Trump had indicated that troops would leave Iran soon, even if no deal is reached. During his prime-time speech, the US President said that the country’s “core strategic objectives” in the ongoing war were close to being achieved.
However, Trump also warned of severe strikes on Iran over the next two to three weeks, including potential strikes on civilian infrastructure in case no deal is reached.
Meanwhile, Oman and Iran are preparing a toll for tankers through the Hormuz chokepoint.
The UK is hosting a virtual meeting of about 40 nations to discuss options on securing the route, while the US is unlikely to participate.
The conflict has triggered a sharp gain in crude oil prices, raising inflation concerns, which resulted in investors scaling back speculations of interest rate cuts by the Federal Reserve this year.
Weakness in the US dollar lent further support to oil prices, as a softer greenback makes commodities cheaper for foreign currency holders. The US dollar index, which measures the greenback’s performance versus a basket of major peers, edged lower to 100.02 this morning.
Spot prices for WTI crude oil jumped 13.1% to $112.42 per barrel, while Brent prices gained 8% to $112.77 per barrel.
In other energy trading, gasoline rose 6.1% to $3.2790, while heating oil jumped 9.2% to $4.4298. Natural gas bucked the trend, slipping 0.4% to $2.807.
On Tuesday, Trump had indicated that troops would leave Iran soon, even if no deal is reached. During his prime-time speech, the US President said that the country’s “core strategic objectives” in the ongoing war were close to being achieved.
However, Trump also warned of severe strikes on Iran over the next two to three weeks, including potential strikes on civilian infrastructure in case no deal is reached.
Meanwhile, Oman and Iran are preparing a toll for tankers through the Hormuz chokepoint.
The UK is hosting a virtual meeting of about 40 nations to discuss options on securing the route, while the US is unlikely to participate.
Crude oil prices jump by more than 10%
Data released on Wednesday showed US crude inventories surged by 5.5 million barrels to 461.6 million barrels during the week ended March 27, versus market estimates of a gain of 814,000 barrels. US gasoline stockpiles declined by 0.6 million barrels to 240.9 million barrels, versus expectations of a decline of 1.9 million barrels, while distillate stockpiles declined by 2.1 million barrels to 117.8 million barrels, compared to expectations of 0.6 million barrels.The conflict has triggered a sharp gain in crude oil prices, raising inflation concerns, which resulted in investors scaling back speculations of interest rate cuts by the Federal Reserve this year.
Weakness in the US dollar lent further support to oil prices, as a softer greenback makes commodities cheaper for foreign currency holders. The US dollar index, which measures the greenback’s performance versus a basket of major peers, edged lower to 100.02 this morning.
Spot prices for WTI crude oil jumped 13.1% to $112.42 per barrel, while Brent prices gained 8% to $112.77 per barrel.
In other energy trading, gasoline rose 6.1% to $3.2790, while heating oil jumped 9.2% to $4.4298. Natural gas bucked the trend, slipping 0.4% to $2.807.
BREAKING:
Crude oil jumps more than 10% to $110 per barrel after Trump vowed to hit Iran “EXTEMELY” hard over the next two to three weeks.
Rose oil price
What to watch:
Investors will keep an eye on the developments related to the conflict in the Middle East.
Markets will also focus on OPEC+ (Organization of the Petroleum Exporting Countries and its allies), which is expected to consider a further increase in oil output on Sunday.
Markets will also focus on OPEC+ (Organization of the Petroleum Exporting Countries and its allies), which is expected to consider a further increase in oil output on Sunday.