Barclays on the risk of $15 jump higher for oil prices

Barclays analysts suggest that a potential Israeli strike on Iranian oil production or export infrastructure presents a binary risk to the global oil markets.

Such an event could shrink the current excess in spare capacity, which has been exerting downward pressure on prices, while simultaneously introducing a considerable geopolitical risk premium. This dynamic, they note, has been a key driver behind the recent uptick in oil market volatility.

The bank highlights that a prolonged disruption of 1 million barrels per day (mb/d) in Iranian oil supplies could push prices at least $15 per barrel higher from current levels. However, given the uncertain geopolitical landscape, Barclays remains cautious about assigning a high probability to this outcome.

Brent:

This article was written by Eamonn Sheridan at www.forexlive.com.