Oil could be driven over $100 a barrel by Iran conflict, analysts warn, as stock markets drop – business live

02.38 EST Analyst: Oil prices could hit $100/bbl as Strait of Hormuz traffic halts Analysts are warning that the US-Israel war with Iran could drive oil prices up to $100 a barrel. Consultancy firm Wood Mackenzie is warning that higher oil and gas prices are certain, and that oil prices could potentially exceeding $100/barrell if tanker flows through the Strait of Hormuz are not quickly restored. They say tanker traffic has been effectively halted, after Iran warned shipping away from the waterway and insurers withdrew coverage. In the current scenario, oil prices over US$100/bbl are possible if transit flows are not re-established quickly, according to Alan Gelder, SVP of Refining, Chemicals and Oil Markets at Wood Mackenzie. Gelder explains: “The key question is when do vessels re-establish export flows. “No doubt, tanker rates and insurance will increase dramatically, but these costs would only be a small part of the oil price impact associated with a curtailment of oil flows if they last for more than a few days.” Even in the optimistic scenario where Iran cooperates with the US, it could take a few weeks for export flows to re-establish themselves, Gelder added, saying: “During that time, oil prices are heavily risked to the upside. The most recent comparison is during the early days of the Russia/Ukraine conflict, when the fear of loss of Russian supplies drove the oil price to over US$125/bbl.” Brent crude last traded as high as $100/barrel in 2022, early in the Russia-Ukraine war.