Crude oil prices rose to a new 2018 high after missile strikes on Saudi Arabia. Three missiles launched by the Yemeni Islamic Houthi rebels on Wednesday were intercepted by Saudi Arabia’s air defense forces. The Houthis claimed that their missiles targeted the Saudi defense ministry and the Saudi Aramco oil distribution facility in Najran.
Crude Oil Prices Rise Due to Trump – Putin Disagreement
For this reason, and also because of the belligerent noises being made by Donald Trump, businesses are becoming worried. The continuing supply of oil from this region may be at risk. Oil prices are unstable due to worries over the continuing escalation of the Trump-Putin disagreement. The recent chemical attack in Syria, allegedly instigated by the Syrian government, has created problems between the two super-powers. This rapidly escalating situation is having a significant effect on oil prices in the area.
Trump Missile Strike on Syria Would Affect Crude Oil Prices
If the missile strike on Syria threatened by President Trump goes ahead, then Russia will likely respond in kind. Putin has threatened to attack the source of the strike. Russian President Putin is known to keep any promises or threats that he makes.
Even limited military action between these two world superpowers in the Middle East would have a potentially catastrophic effect on the oil industry in the region. Prices would shoot up with the possibility of a shortage brought on by conflict in this region.
Brent Price at Highest Level for Years
Already, Brent has reached its highest level for over three years. Putin is sure to respond in kind on any US strike on Syria. He threatened to respond with an attack on the base where the strike originated. This was a promise made by Vladimir Putin who is well known for keeping his promises. Donald Trump’s warning for Russia to “get ready” for “nice and new and ‘smart’” missiles targeting Syria does nothing to cool the situation. Is this guy for real? Let’s hope not!
Brent crude reached $72 a barrel, up 1.4% on Tuesday’s closing price. US West Texas Intermediate Crude rose 1.8% to $66.70. Should the situation in the Middle East deteriorate further, then these prices are sure to rise.
Missile Strike and Crude Oil Prices
If Trump escalates this situation with a missile strike, he may also have a strike at Iran (which backs Assad in Syria) while he is at it. That is sure to ignite an Islamist backlash not to mention what the Russians may do about it. They won’t sit back, and it is sure to make oil prices rise through the roof! Crude oil prices will remain unstable while the situation in the Middle East also remains unstable particularly in Syria and Iran.