Article #77789

Oil prices hit four-week highs and European shares fall after fresh US-Iran attacks and blockade on Iranian shipping

Crude oil prices have hit their highest levels in four weeks, as Washington and Tehran traded attacks and the US reimposed a naval blockade of Iran.

Brent crude has jumped $3.79 a barrel to $87.08 a barrel, a 4.55% increase, the highest since 12 June, before the ceasefire. The US and Iran signed a memorandum of understanding to end the conflict on 17 June and engaged in negotiations for a permanent peace deal.

What we think is that the peak of the escalation is behind us, but there are upside risks to oil prices if these disruptions continue and that will keep prices in the $85-$90 range.

But I would have ‌added the very strong caveat to that it seems to me ‌that the situation remained unstable, and the ceasefire was fragile.