Oil unlikely to reach $200 - US Energy Secretary
Kyiv • UNN
Chris Wright believes a price jump to $200 is unlikely despite the blockade of the Strait of Hormuz. Oil prices rose to $100 due to attacks on tankers.
US Energy Secretary Chris Wright said on Thursday that global oil prices are unlikely to reach $200 a barrel, despite oil tankers remaining blocked in the Strait of Hormuz and the US and Israel's war with Iran escalating, UNN reports with reference to Reuters.
Details
"I would say it's unlikely, but we are focused on the military operation and solving the problem," Wright told CNN when asked if prices would reach $200 a barrel – a level an Iranian official said on Wednesday prices could reach if the war continues to escalate.
"Prepare for the price of oil to reach $200 a barrel, because the price of oil depends on regional security, which you have destabilized," Ibrahim Zolfaghari, spokesman for the Khatam al-Anbiya military command headquarters in Tehran, said on Wednesday.
Oil prices jumped 6% to nearly $100 on Thursday after two tankers caught fire in an Iraqi port after colliding with Iranian boats packed with explosives.
The price increase came despite more than 30 member countries of the International Energy Agency announcing the day before the largest coordinated reduction in global oil reserves in history, by 400 million barrels, about 40% of which will come from the United States, the world's largest oil producer.
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The war has forced Persian Gulf countries in the Middle East to cut total oil production by at least 10 million barrels per day, which is about 10% of global demand. On Thursday, the IEA said this was the largest disruption to oil supplies in the history of the global market.
Wright also told CNBC on Thursday that the US Navy is currently unable to escort ships through the Strait of Hormuz, but it is "likely" that this could happen by the end of the month.
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