Attacks on oil tankers in the Middle East are brewing

Spark Global Limited reports:

Oil prices have tumbled over the past two sessions, with US WTI dipping below $70 overnight, as a surge in cases of a mutated delta virus reignited fears that the global economic recovery could be thwarted.

However, with the outlook for energy markets threatening to be again clouded by a renewed outbreak of the virus, many market participants are now more focused on the Middle East, with recent attacks and hijackings on ships in the Gulf of Oman and the Persian Gulf, and western countries generally pointing the finger at Iran. It comes as renewed talks on a nuclear deal between the US and Iran continue to be deadlocked at a time when tensions between the West and Iran are already rising.

Spark Global Limited reports:

Spark Global Limited reports:

Iran, West At War over Ship Attacks in Middle East

A British and A Romanian crew were killed in a suspected drone attack on the Mercer Street, a tanker owned by Jodiac Marine, in the northern Indian Ocean on Friday, the company said on Friday. The Zodiak Shipping company is part of the Zodiak Group, which is controlled by wealthy Israeli businessman Eyal Ofer and his family.

After the incident, Israel, Britain and the United States accused Iran of attacking the Mercer Street, raising tensions in the region, which Iran strongly denied.

British Foreign Secretary Dominic Raab said on Sunday that it was highly likely that an Iranian drone strike or drone strikes had caused the incident and that There would be a “coordinated response” from Britain and its international partners. U.S. Secretary of State Antony Blinken also said the United States is “confident” that Iran carried out the attack using an explosive drone, and that the United States is considering follow-up measures with its partners and “appropriate responses” with countries in and outside the region.

In response, Iranian Foreign Ministry spokesman Saeed Khatibzad said On Monday that Iran condemned “in the strongest terms” the “groundless” accusations and “political provocations” by Britain and the United States. He pointed out that the UK and US had not produced any evidence to support the claim that Iran had attacked the tanker. Iran will not hesitate to defend its national security and interests, and will respond quickly and decisively to any risk that may arise.

Just days after the initial oil tanker attack, maritime security sources said on Tuesday that the Panamanian flag Asphalt Princess had been seized in the Waters of the Arabian Sea leading to the Strait of Hormuz. Britain’s Maritime Trade Agency reported a “potential hijacking” in the area.

State Department spokesman Ned Price later said, “We are aware of reports of a maritime incident in the Gulf of Oman. We are concerned about the incident and are looking into the reports.” U.S. officials, speaking on condition of anonymity, also said the U.S. military is expected to redeploy at least one ship near the Asphalt Princess’s location for close monitoring.

Abolfazl Shekarchi, a senior spokesman for Iran’s armed forces, denounced reports of maritime incidents and hijackings in the Gulf as a form of “psychological warfare” — paving the way for a new round of violations, the Fars news agency reported. Iran’s foreign Ministry called reports of incidents at sea “suspicious” and warned against trying to create a “false atmosphere” against Tehran.

Investors in the oil market are on high alert as the situation in Iran continues to obscure

So far, due to the accusations and protests between Western countries and Iran, more is still only verbal level, the impact on the oil market is not too big. After the latest hijackings broke on Tuesday, international oil prices came off their lows of the day, with WTI crude hovering around $70.36 and Brent crude trading at $72.30.

Still, Helima Croft, a former CIA analyst who is now head of global commodity strategy at Royal Bank of Canada, said the situation was worrying given last week’s attack that left two people dead.

“You have to put these attacks in the context of the emergence of a new hardline government in Iran,” Croft said. This raises the risk of unintended escalation or one side not understanding the other’s red lines.”

It comes at a time of deadlock over a nuclear deal between Iran and major international powers. Iran’s supreme Leader ayatollah Ali Khamenei authorized Leahy as the country’s new president on August 3. The hardline figure in Iranian politics will be formally sworn in in parliament on May 5. In the past few days, Mr. Leahy has stepped up his attacks on the United States, saying he would take steps to lift “brutal” U.S. sanctions on Iran and that “we will not subject our economy to the will of foreigners.”

Croft said that now that a new Iranian government has been formed, the best time for A deal between Washington and Tehran may have passed. “The very fact that the US is now dealing with a different negotiating team suggests that the process will be longer,” she said. If you add maritime safety incidents… That would make it much harder to renegotiate a deal. Iran could take a hard line and try to force Washington to compromise.”

Croft said the oil market is particularly focused on the possibility of another economic slowdown and lower oil demand because of the new outbreak. However, rising tensions with Iran have reduced the chances of an imminent nuclear deal, meaning there is no hope of Iranian oil returning to the market any time soon. And if tensions escalate further, they could disrupt oil markets and, in turn, prices.

“If we see real signs of disruptions in production or delivery, the market will move quickly,” she said.