Oil prices rose after tensions between the U.S. and Iran escalated over the weekend as Tehran launched fresh drone and missile attacks on Bahrain and Kuwait in response to new U.S. airstrikes, adding to uncertainties clouding the global economic outlook.
Early Monday, Brent crude, the international standard, was up 0.9% to $73.25 a barrel. It sold for about $72 a barrel before the war began. Benchmark U.S. crude gained 1.2% to $70.06 a barrel.
There’s still plenty of risk facing the oil market, ING commodities strategists Warren Patterson and Ewa Manthey said in a commentary Monday, as more questions were raised about the safety of ships in the Strait of Hormuz following attacks on vessels.
Oil traders have been “too optimistic” about the timeline for a recovery in Persian Gulf supplies, they said.
“This complacency is odd and clearly leaves significant upside risk if the supply recovery proves slow — or if we see significant re-escalation,” the commentary said.
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