The now wide -losing war between Israel and Iran ruins the energy market. When Iran relies on an escalation and the most important oil artery in the world, the hormus route, closes, threatens a huge price shock. The “Kroon” asked an energy expert, whatever that would mean for fuel prices.
Oil prices always react nervously to global unrest, but given the development in the middle and the declaration of war from Netanyahu to Iran, a real price shock can be on hands. Relaxation is currently not in sight, says renowned energy expert Johannes Benigni of JBC Vienna in the “Krone” discussion.
On Friday, the course per barrel rose by almost 10 percent to $ 78-that is the strongest increase since Corona Pandemy Mid 2020. The price is now again around the level from the beginning of the year. The level finally fell over and over again. Because the oil price is also an economic indicator and the economy was recently developed rather weakly.
“It’s a game with the fire”
But now it can be very serious. “It’s a game with the fire,” says Benigni. The focus is on the strategically very important hormus road, the most important oil artery in the world. More than 20 million barrels of oil are transported every day on the narrow marine road. If Iran closes the route, a fifth of the global oil supply would be influenced and even a quarter of the global liquid gasting sports.
Iran has a very important means of pressure. And the state itself also plays a not -insignificant role as an oil producer. The country exports around 1.5 million barrels a day every day, the majority to China. The failure could still be reversed with the world market, but the more sensitive situation takes place around the Hormus Supply route as mentioned.
If Iran closes this route, the oil price can rise to more than $ 100. Expert Benigni expects even the “crown” with values of more than $ 150. That would be a doubling and a new all -time high. Even as a result of the conflict in Ukraine, the price “only” rose to a level of $ 130, the course registered its record in 2008, where it was noted near the $ 150.
Iran and Israel go to the world powers
Such a huge price increase would have some effects. “Iran would then have large parts of the world against it,” says the energy expert, who therefore also doubts that it will come to that. Because if “Iran plays this card, it no longer has the pressure of the pressure,” said Benigni. However, the risk of closure, however, will keep the oil price up because the market is restless. Moreover, the war can also harden the war of geopolitically important fronts. “Neither Trump nor Putin really want this war, but are drawn by Israel and Iran,” Benigni analyzes.
And what does that mean for fuel prices? Benigni: “The effects will probably be noticed on Monday at the gas pumps.” The bustle of the raw oil price usually touches the tank prices relatively quickly. Somewhat muted – fortunately European drivers – the weak dollar course. Because the raw materials that are traded in the American currency is therefore cheaper in euros.
With full escalation, diesel price threatens more than 2 euros
But if the war had to escalate, there are also huge climbs on diesel and gasoline, even a price of more than two euros per liter would no longer be unrealistic. That would undoubtedly heat inflation.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
