Commerzbank’s commodity team highlights renewed geopolitical risks for Oil as Iran again threatens to block the Strait of Bab al-Mandab, a key route for Saudi exports rerouted from the Strait of Hormuz. Brent has already gained nearly 12% since last Friday, and the bank warns that a blockade would likely push Oil prices higher still.
Geopolitics keep Brent supported
“The recent exchange of military strikes over the past few days has caused oil and gas prices, in particular, to rise significantly.”
“Should a blockade of the Strait of Bab al-Mandab occur in the wake of further escalation, the price of oil in particular is likely to rise further.”
“Crude oil processing could rise again in July following the lifting of the export ban on oil products.”
“Furthermore, crude oil imports are also likely to increase again this month as the oil tankers that were able to pass through the Strait of Hormuz in June reach Chinese ports.”
