Last week, the global oil market saw an unusual spike, largely due to Iran halting oil exports through the Strait of Hormuz. Iran stopped the oil supply to Saudi Arabia and other countries, disrupting the global supply chain.
Why Prices Could Rise
When oil supply is constrained and global markets face reduced availability, prices inevitably rise. In recent days, Brent crude surged above $85 per barrel, and analysts believe that if this disruption continues, prices could reach $100 per barrel or even higher.
Why Prices Could Fall
On the other hand, if conditions improve, diplomatic efforts succeed, and supply resumes, prices could drop back to $70 to $75 per barrel. Moreover, if other countries increase their production and offset the shortage, prices could stabilise.
Conclusion
This week and month, oil prices are poised for significant volatility. Iran’s actions have disrupted global supply, pushing prices higher. However, investors must stay alert, as diplomatic developments or supply adjustments could quickly reverse the trend.
