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An attack on Saudi Arabia shut about 5% of global crude output, producing the largest oil price surge since 1991. U.S. officials blamed Iran, and President Trump said Washington was locked and loaded to retaliate.
The supply shock and the risk of a wider Gulf conflict put a sharp risk premium on crude. Higher energy prices raise the cost of fuel, fertilizer and transport for feed production.
reuters.comRania El GamalSep 16, 2019After 656 past bullish geopolitics events, Crude Oil (Brent) moved a median +1.9% over 5 sessions (63% higher; middle half -2.7% to +6.6%), and +0.7% over 20.
After 626 past bullish geopolitics events, Crude Oil (WTI) moved a median +2.1% over 5 sessions (62% higher; middle half -2.3% to +8.5%), and +1.6% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
Combines the supply loss with US blame on Iran and retaliation threats, adding geopolitical escalation risk to prices.
US blame on Iran and retaliation talk added a geopolitical risk premium.
