Trump’s Threats to Iran Push Oil Prices Higher
Oil prices surged on Wednesday to their highest level in four months following President Donald Trump’s threats of further attacks on Iran and his call for Tehran to negotiate a fair deal.
In a post on his social media platform, Truth Social, Trump stated, “We hope Iran will quickly come to the negotiating table to negotiate a fair and equitable deal… The upcoming attack will be far worse than the one that took place last year.”
The potential risk to Iranian supplies has driven oil prices up, allowing futures contracts to start the year on solid footing. Prices have increased by over 10% this month, despite expectations of an oversupply in the market. This situation has also kept the cost of call options high compared to put options.
After Trump’s post, the price of Brent crude futures reached $68.19 per barrel, marking its highest level since late September, following a 3% rise on Wednesday.
Bloomberg News reported that Trump reiterated yesterday that a “massive fleet” is heading to the Middle East, adding that he hopes the United States will not need to use it.
Today, he mentioned that the fleet is larger than the one sent to Venezuela, where U.S. forces arrested Nicolás Maduro and sent him to the U.S. to face charges of terrorism and drug trafficking earlier this year.
As of 12:56 PM London time, the price of Brent crude rose by 0.6% to $67.97 per barrel for March delivery, while West Texas Intermediate crude for March increased by 0.7% to $62.84 per barrel.
