Oil price reverses gains, falls 0.8% despite escalating US-Iran hostilities
24 per barrel on Wednesday as investors took profits after the previous day’s sharp rally, although renewed military confrontation and escalating rhetoric between the United States and Iran continued to underpin fears of disruptions to global crude supplies.
Market analyst Olufemi Idowu, Partner at Kreston Pedabo, said the renewed conflict has restored a significant geopolitical risk premium to crude prices, with investors closely monitoring developments around the Strait of Hormuz and the potential impact of further sanctions and military action on global energy markets.
Brent crude had weakened to around $72 per barrel amid easing geopolitical tensions, increased production by OPEC+ members and concerns over slowing global demand before rebounding to $76 on Sunday and surging to nearly $85 on Tuesday.
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