Today is a very good time to look at the commodity markets, which are quite volatile. Thanks to the recent escalation in the conflict between the United States and Iran, crude oil in particular has been increasing in value.
Just today, the price of oil has already registered a 2% increase. The value has continued to climb up after news from the past few days indicates that the US and Iran are nowhere near resolving their differences peacefully.
A quick reminder of what happened: on Friday the US ordered an airstrike on an airport in Baghdad, where the country had intelligence Qassem Soleimani will be. Soleimani was one of the highest ranking Iranian military officers, widely seen as the right hand of Supreme Leader Ali Khamenei.
In the aftermath of the attack, as Iran and the United States exchanged harsh threats, Iraq ordered the United States (and other foreign military currently there) to leave the country.
Iraq and Iran are among the most prominent members of OPEC, though Iran is currently losing its relevance as an oil exporter due to international sanctions. Moreover, yesterday Donald Trump stated that he will impose sanctions on Iraq too, if the country insists that the US troops leave its territories.
As a result of the budding conflict, the Brent crude has climbed above $70, trading around $70.03 this morning. The WTI reached $64.15; both of these values are already much higher than the initial forecast for oil’s movements in 2020, though naturally the forecast did not account for any sudden conflicts.
