Just when it seemed oil traders were coming to terms with serious – but predictable – supply threats in the Middle East, something new happened. So, how concerned should you be?
Take a look at my MoneyShow Chart of the Day – which, in this case, is a map from the Wall Street Journal. It shows where vessels have suffered attacks in the Middle East by Iran or its proxies over the last month. You can see almost every strike was in or near the Strait of Hormuz...until a couple of days ago!
Middle East Vessel Attacks (9/5 – 10/7)
Source: Wall Street Journal
The “Acers” is an oil and chemical tanker that reportedly took several hits late Wednesday – resulting in unspecified casualties. The strikes occurred hundreds of miles from the Strait off the coast of Qatar.
Moreover, ten tankers suffered attacks in the most recent tracked week, according to the maritime intelligence firm Kpler. That was the highest in any week since the conflict began.
If we see an uptick in strikes overall – and especially attacks away from the narrow confines of the Strait – it would suggest Iran is finding new ways to disrupt Middle East oil supplies. Shipments had been increasing lately thanks to US security support and the use of so-called “shuttle runs.”
US WTI crude oil futures spiked more than 3% on the news. They remain rangebound in the longer term, recently trading around $91 a barrel. That’s well below the early-April closing high around $113. But it’s also well above the post-war low, which was just under $69 during the first week of July.