Oil rose again on Monday after Israel and Iran continued attacks on each other, entering the fourth day, with the market bracing for an escalation that could disrupt supply from a region that produces around a third of the world’s crude.
Brent jumped as much as 5.5% at the open before paring gains to trade around $75 a barrel, while West Texas Intermediate was near $74. Israel launched an attack on the South Pars gas field, forcing the halt of a production platform, after strikes on Iran’s nuclear sites and military leadership last week.
While an attack on Iran’s gas-producing infrastructure is a concern, the biggest fear for the oil market centres on the Strait of Hormuz. Middle East producers ship about a fifth of the world’s daily output through the narrow waterway, and prices could soar further if Tehran attempts to block the route.
