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<Research>Citi: Oil Prices May Leap 15-20% If Iranian Oil Exports Disrupted
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The escalating conflict between Iran and Israel aroused concerns about potential disruptions in oil supply and transportation during and after the instability in the Middle East, Citigroup said in a research report. Looking at the impact of six major geopolitical crises on oil supply since the 1990 Gulf War, Citigroup lately expected that oil prices could be shored up by around 15-20% if Iran's daily export volume of 1.1 million barrels is disrupted, reaching a range of about US$75-78, compared to the monthly average Brent oil price of about US$65 before the escalation on June 12. Current market prices have already factored in the probability of Iranian supply disruptions and the Iranian authorities blocking the Strait of Hormuz, suggesting that any closure of the strait could lead to sharp oil price volatility, the broker noted. However, countries are actively mediating, so the likelihood of transport routes being closed for several months is considered to be low. AASTOCKS Financial News Website: www.aastocks.com |
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