Oil markets are closed for the weekend but are set to see price swings next week with the impact of the U.S. strikes on production and transport unclear.
Pre-conflict scenarios have foreseen a quick price spike that fades if Iranian pipelines and its Kharg island terminal remain operational. But there would be a bigger price spike and longer-lasting impact if oil infrastructure or supplies are interrupted, for instance because of disruption of tanker traffic through the Strait of Hormuz that sees 20% of global oil supply pass through each day.
Limited strikes on Iran’s nuclear program and Islamic Revolutionary Guards Corps that avoid a change of government or all-out war could see prices jump $5-$10 based on fear alone, according to Rystad Energy.
A wider war, however, involving Iranian disruption of tanker traffic could see crude push past $90 per barrel and U.S. gas prices “well above” $3 per gallon, according to Clayton Seigle at the Center for Strategic & International Studies.
International benchmark Brent crude closed at a seven-month high of $72.87 on Friday.
