Oil prices (CL=F, BZ=F) are rising for the fifth consecutive day of trading due to fears that the escalation of the conflict in the Middle East could affect oil supplies. Lipow Oil Associates President Andy Lipow joins Catalysts to discuss the commodity’s movement and outlook as tensions rise in the Middle East.
“The market is certainly concerned about this growing tension between Israel and Hezbollah across the Israel-Lebanon border, and whether that could result in Israel attacking its facilities in Iran. But I don’t think we’re going to see a Strait of Hormuz closure or things of the kind, but the market is betting on an additional geopolitical risk that such an event could occur”, explains Lipow.
He notes that the Strait of Hormuz is particularly important because it is where 20% of the world’s oil supplies transit. If it were shut down, oil prices could rise by between 30 and 40 dollars per barrel.
For more expert insights and the latest market action, click here to watch this full episode of Catalysts.
This post was written by Melanie Riehl
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