Oil prices again topped $100 per barrel on Thursday as widespread Iranian attacks on Middle Eastern energy facilities overshadowed a vast release of government reserves.
As Donald Trump vowed to “finish the job” and press ahead with the US-Israel war on Iran, the country’s regime stepped up retaliatory strikes on economic targets across the region.
Several merchant ships were struck in and around the strait of Hormuz, one of the most important arteries in global trade. Three crew members aboard one of the ships – the Thai-registered Mayuree Naree – were “believed to be trapped”, the vessel’s owner said.
Meanwhile, Iraq halted all operations at its oil ports after an attack on two nearby oil tankers. Bahrain told residents to stay home after an Iranian attack on fuel tanks in the Muharraq Governorate.
Oman shifted all vessels out of its main oil export terminal at Mina Al Fahal – one of the few remaining ports from which crude can be shipped from the Middle East to the world – after drone strikes at another of its ports, Bloomberg reported, citing sources who received a notice from a port agent.
The price of Brent crude, the international benchmark, rallied by 9% to $100.29 per barrel on Thursday despite efforts by governments across the world to allay fears of a sustained supply crunch.
It broke into three figures for the first time in four years on Monday, when it surged as much as 29%, before falling back sharply after Donald Trump described the war as “very complete” in a series of conflicting remarks.
In a bid to calm concerns over oil supplies, the International Energy Agency (IEA) ordered the largest release of government reserves in its history on Wednesday, when its 32 members unanimously agreed to release 400m barrels of emergency crude.
This record release was swiftly eclipsed, however, as fresh violence across the Middle East – and signs that Tehran was deliberately targeting sites – heightened apprehension around ongoing disruption in global energy markets.
As prices resumed their rise, Iran’s military command goaded the US. “Get ready for oil to be $200 a barrel, because the oil price depends on regional security, which you have destabilised,” a spokesperson said.
The West Texas Intermediate price of US crude also climbed back towards $100 early on Thursday, rising 8.6% to $94.75 per barrel. Leading stock markets in Asia came under pressure, with the Nikkei 225 dropping 1.6% in Japan while the Kospi fell 1.2% in South Korea.
The strait of Hormuz, through which about a fifth of global oil and seaborne gas tankers typically pass, has been in effect closed since the conflict began on 28 February.
Aramco, Saudi Arabia’s state oil company, has warned of “catastrophic consequences” for the world’s oil markets if the strait remains blocked.
As part of the IEA’s move to calm the oil price shock sparked by the war in Iran, the United States announced plans to release 172m barrels of oil from its strategic petroleum reserve.
US energy secretary Chris Wright said the release will begin next week, and take approximately 120 days to deliver.
In his statement, Wright accused Iran of having “manipulated and threatened the energy security of America and its allies”.
Trump had said earlier on Wednesday that he planned to tap the petroleum reserve.
Reuters contributed reporting
Source: theguardian.com
