The price of Brent crude, the global oil benchmark, is booming again as geopolitical concerns rise.Credit…Turar Kazangapov/Reuters
Oil spike ripples through global markets
The price of Brent crude rose again on Friday, at one point topping $91 a barrel. Growing tensions in the Middle East have pushed the global benchmark to levels last reached in October.
That poses a potential problem for President Biden ahead of the election and raises new questions about when the Fed will start cutting interest rates.
Some analysts believe the oil rally is just beginning, creating a fresh inflation risk for central bankers who are struggling to keep price-increases in check. JPMorgan Chase forecast last week that oil would climb above $100 by September. And, in a bad sign for motorists, gasoline prices in the U.S. have climbed 6 percent in the past month just ahead of the North American summer driving season.
Market watchers have been concerned about a wider Middle Eastern conflict after Hamas attacked Israel on Oct. 7. Most recently, oil traders have been bracing for Iranian retaliation after an Israeli airstrike on Tehran’s consulate in Damascus, Syria.
“If we get a direct conflict between Israel and Iran, that’s something that will likely restrict the supply of oil coming from the Middle East,” Matt Maley, an analyst at Miller Tabak + Co., told Bloomberg.
