29m ago
12.27 BST
Oil hits
highest level since US-Iran ceasefire began
The oil
price has hit its highest level since the US and Iran agreed a ceasefire more
than two weeks ago.
Brent
crude traded as high as $107.48 a barrel this morning, its highest level since
7 April, the day when the US and Iran agreed to a conditional ceasefire.
That deal
included a temporary reopening of the strait of Hormuz, after Donald Trump had
threatened Iran with widespread destruction.
But with
the strait still largely blockaged, and oil production in the region having
more than halved since the war began (see earlier post), anxiety over the
conflict is rising again today.
Brent
crude had been trading around $72 a barrel before the war began, and hit
$199.50 in early March.
Oil is up
today despite Trump announcing last night that a ceasefire between Israel and
Lebanon would be extended by three weeks.
But, when
asked how long he was willing to wait for a long-term peace deal with Iran,
Trump replied: “Don’t rush me”.
The risks
to the oil price “remain tilted to the upside”, Fawad Razaqzada, market analyst
at Forex.com, explains, as the US-Iran stalemate drags on.
Razaqzada
adds:
“Oil
has been on a firm upward trajectory this week, clearly driven by the collapse
of planned talks between the US and Iran.
Tehran
has refused to engage while the naval blockade remains in place, fuelling
concerns over tightening supply and pushing prices well above $100 per barrel
again.
There
was a brief pause when Trump opted to extend the ceasefire, but the effect
proved short-lived. With no clear timeline for negotiations and both sides
entrenched, markets remain in limbo — and prices continue to grind higher.”
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