Oil can reach $ 120 a barrel if Israel’s conflict disrupted Iran’s offer

If the escalating conflict between Israel and Iran significantly reduces the supply in the global oil market, prices may rise to up to $ 120 a barrel due to a possible threat to a large shipping passage, according to industry experts.

The price of West Texas Interidia, a major criterion for crude oil, sits around one year, while Brent crude is approaching on Wednesday for five months as the conflict between Israel and Iran enters on the sixth day.

president Donald Trump He met with the National Security Team on Tuesday to discuss the escalating conflict, which sparked speculation that the United States could prepare to join the attack, creating more fluctuations in the market, according to Ewa Manthey, commodity strategies in financial services.

Exxonmobil CEO of oil supplies is talking amid Iran-Israel’s conflict

But Manethi said that the “main concern of the market” is the possibility of disrupting shipping through the Strait of Hormuz, a critical waterway linking the Persian Gulf to the Gulf of Oman and the Arab Sea. The waterway is not only wide enough to deal with the largest crude oil tankers in the world. It is considered one of the most important oil selection points in the world, according to Energy Information Management (EIA).

Executive Chairman of Exxonmobil Darren Woods He repeated these concerns, saying that although global oil supplies are sufficient to bear the failure of Iranian exports, the biggest anxiety is the potential impact of oil shipments through this waterway, which moves nearly a third of the global oil trade transported in the sea.

In 2024, 20 million barrels of oil flowed per day, or about 20 % of global petroleum fluid consumption, through the waterway. There are also very few alternative options to transport oil from the strait if closed, according to the measuring of the environmental environment.

The high oil prices after Israel strikes on Iran

The great turmoil of these flows will be sufficient to pay prices to $ 120 a barrelAccording to Mansi. But if the disturbances persist at the end of the year, it indicated that Brent could circulate with new record levels, bypassing the record of $ 150 a barrel reached in 2008.

“If this happens, we will need to see governments that take advantage of their strategic oil reserves,” Maneti said, noting that it includes the United States, which is located on more than 400 million barrels of crude oil in its strategic petroleum reserves.

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Another solution is that the organization of the oil exporting countries (OPEC+) has benefited from its reserve production capacity of more than 5 million barrels per day.

“While they are in the process of re -showing online, disrupting the Iranian offer may lead them to restore this offer at a faster pace,” said Mansi.