Mideast Conflict Continues To Haunt Global Oil Market

Investors remain cautious about the situation in the Strait of Hormuz and how it is impacting global energy flows, including oil and gas. The strait is still mostly closed, and the U.S. has also imposed its own sea blockade on Iranian ports since
last month.
A drone strike over the weekend on a United Arab Emirates’ nuclear power plant added to worries over a potential escalation in the conflict.
Brent crude, the international standard, gained climbed over $110 per barrell in morning trading. It was trading at roughly $70 a barrel in late February before the start of the Iran war.
“Re-escalation risks are increasing,” ING commodities strategists Warren Patterson and Ewa Manthey wrote in a research note. While there has also been a pick up on shipping activities over the past week around the strait, they said, “this can change quickly.”
The pair also noted that the oil market was reacting to the lack of tangible results on the Iran war after last week’s widely-watched summit between Trump and Chinese President Xi Jinping in Beijing, even as the White House said both the U.S. and China had agreed that the Strait of Hormuz must remain open.
U.S. officials had hoped that Beijing could use its influence, given its economic ties with Iran, to help broker a peace agreement and reopen the strait.