Iran warns that oil prices could rise to $200

“Be ready for oil prices to rise to 200 USD a barrel, because oil prices depend on the security of the region you are destabilizing,” Ebrahim Zolfaqari – spokesman for Iran’s military command said in comments to the US on March 11.

On March 11, Iran launched missiles at Israel and targets across the Middle East. This shows that they still have the ability to counterattack and disrupt energy supplies, despite the Pentagon saying the US and Israel are conducting the most intense air strikes to date.

On March 9, oil prices were close to 120 USD per barrel – the highest in 4 years. However, just one day later, both WTI and Brent oil dropped more than 11% when US President Donald Trump predicted that the war in the Middle East would soon end. On March 11, oil prices continuously fluctuated, currently increasing by nearly 2% to 85-89 USD.

Investors had bet that President Trump would soon find a way to end the war that he and Israel launched nearly two weeks ago. However, so far the situation has not cooled down. There are no signs that ships can safely navigate the Strait of Hormuz, which carries about 20% of the world’s oil. This is considered the most serious energy supply disruption since the oil shock of the 1970s.

On March 11, the Iranian military even announced that it would target economic targets of the US – Israel and the offices of US technology giants in the region. They also urged people in the area to avoid coming within 1 km of banks.