BAKU, Azerbaijan, July 13, Oil prices jumped more than 4 percent after a new escalation between the United States and Iran threatened the already fragile ceasefire between the two sides.
Both major oil benchmarks, which had fallen significantly following the announcement of an interim agreement, surged by as much as 4.5 percent amid growing concerns that renewed tensions could disrupt energy markets and increase inflationary pressures worldwide.
Market analyst Fawad Razaqzada of Forex.com said investors are now preparing for a possible further deterioration of the situation. He noted that although diplomatic rhetoric could ease tensions, traders are currently being forced to consider the worst-case scenario.
The latest hostilities have triggered another rise in crude prices, but IG analyst Fabien Yip said oil prices are unlikely to reach the extreme levels recorded after the start of the US-Israel war against Iran on February 28.
According to analysts, the recent decline in oil prices toward pre-conflict levels reflected market optimism about the fragile US-Iran arrangement. However, renewed military escalation has highlighted the uncertainty surrounding the stability of the agreement and the future of global energy supplies.
Concerns are also growing over the security of the Strait of Hormuz, one of the world’s most important oil transit routes, as any disruption in the region could have a major impact on global crude markets.
