Traders Prepare for Spike in Energy Prices Following Iran's Strike on Israel

Already a subscriber? Traders are preparing for a spike in energy prices following Iran ’s unprecedented strike on Israel , injecting fresh volatility into financial markets .

Oil prices climbed above $US92 on Friday for the first time since October ahead of an anticipated attack. The wholesale petrol price at the end of last week was around $1.87 per litre, according to the NRMA and has been steadily climbing. The international benchmarks that NRMA follows, Tapis Crude oil and Mogas , are already at six-month highs.And that could continue to rise given how markets typically respond to conflict in the Middle East.

A 10 per cent increase in oil prices typically adds around 0.1 per cent to 0.2 per cent to headline inflation in advanced economies, according to Capital Economics. That means the rise in Brent over the past month will add about 0.1 per cent to headline inflation in these countries.Markets are now bracing for a response from Israeli Prime Minister Benjamin Netanyahu, which will also be a key driver for the oil markets.

ANZ believes there is ample spare oil capacity that could be utilised should conflict in the Middle East cause more significant supply disruptions. The bank sees Brent climbing to $US95 a barrel in the short term.

Source: Energy Industry News (energyindustrynews.net)

Traders Spike Energy Prices Iran Strike Israel Volatility Financial Markets Brent Crude Oil Petrol Pump Retaliation Risk

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