Bitcoin briefly sinks below $99,000 as U.S. strikes on Iran trigger crypto market sell-off
CNBC's MacKenzie Sigalos joins 'Special Report' to report on the latest bitcoin price trends following Washington's surprise attack against Iranian nuclear sites.
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USA Today
40 minutes ago
- USA Today
Oil hits five-month high after US strikes key Iranian nuclear sites
SINGAPORE - Oil prices jumped on Monday, local time, to their highest since January as Washington's weekend move to join Israel in attacking Iran's nuclear facilities stoked supply worries. Brent crude futures rose $1.88 or 2.44% at $78.89 a barrel as of 1122 GMT. U.S. West Texas Intermediate crude advanced $1.87 or 2.53% at $75.71. Both contracts jumped by more than 3% earlier in the session to $81.40 and $78.40, respectively, five-month highs, before giving up some gains. The rise in prices came after President Donald Trump said he had "obliterated" Iran's main nuclear sites in strikes over the weekend, joining an Israeli assault in an escalation of conflict in the Middle East as Tehran vowed to defend itself. Iran is OPEC's third-largest crude producer. Market participants expect further price gains amid mounting fears that an Iranian retaliation may include a closure of the Strait of Hormuz, through which roughly a fifth of global crude supply flows. Iran's Press TV reported that the Iranian parliament approved a measure to close the strait. Iran has in the past threatened to close the strait but has never followed through on the move. "The risks of damage to oil infrastructure ... have multiplied," said Sparta Commodities senior analyst June Goh. Although there are alternative pipeline routes out of the region, there will still be crude volumes that cannot be fully exported out if the Strait of Hormuz becomes inaccessible. Shippers will increasingly stay out of the region, she added. Brent has risen 13% since the conflict began on June 13, while WTI has gained around 10%. The current geopolitical risk premium is unlikely to last without tangible supply disruptions, analysts said. Meanwhile, the unwinding of some of the long positions accumulated following a recent price rally could cap an upside to oil prices, Ole Hansen, head of commodity strategy at Saxo Bank, wrote in a market commentary on Sunday. (Reporting by Siyi Liu in Singapore; Editing by Himani Sarkar)
Business Insider
2 hours ago
- Business Insider
Oil prices hit 5-month high after US strikes Iran nuclear sites
Oil prices jumped to a five-month high in Asia on Monday morning in their first trading day after the US struck Iran's nuclear facilities on Sunday. US Benchmark West Texas Intermediate rose as much as 6.2% and was 2.2% higher at $75.48 a barrel at 9:42 p.m. ET on Sunday. International benchmark Brent crude oil futures gained as much as 5.7% before giving up some gains to trade 2.2% higher, at $78.67 a barrel. Markets have been on edge about an oil supply disruption since Israel struck Iran on June 12, as Tehran had frequently threatened to blockade the Strait of Hormuz, a key oil and gas shipping passage for a third of the global seaborne oil and one-fifth of the world's liquified natural gas trade. The Strait of Hormuz links the Persian Gulf to the Indian Ocean, with Iran to its north and the United Arab Emirates and Oman to its south. Iran is also a major oil producer. Crude oil futures have gained over 10% since the conflict began, with a geopolitical risk premium of $12 backed into prices now, according to Goldman Sachs analysts in a Sunday note. Goldman Sachs analysts estimated that Brent oil prices could rise to a peak of around $90 a barrel if Iranian crude supply were to drop by 1.75 million barrels a day. "If oil flows through the Strait of Hormuz were to drop by 50% for one month and then were to remain down 10% for another 11 months, we estimate that Brent would briefly jump to a peak of around $110," they wrote. The Goldman analysts wrote they are still assuming no significant disruptions to oil and gas supply. They flagged risks to oil and gas prices. "While the events in the Middle East remain fluid, we think that the economic incentives, including for the US and China, to try to prevent a sustained and very large disruption of the Strait of Hormuz would be strong," they wrote. On Sunday, the Iranian parliament voted to close the Strait of Hormuz in retaliation against the US's action, although the final decision still lies with the country's top security officials, according to Iran's state-owned Press TV. The developments are taking place amid the summer driving season when US gas demand peaks. Should the gains in oil prices be sustained, pump prices are likely to rise in the weeks ahead. The price of gas typically rises by 2.4 cents per gallon when crude oil prices rise by $1, according to the Energy Information Administration. This translates into a gain of over 20 cents per gallon at current levels for oil futures.
CNBC
2 hours ago
- CNBC
Oil at $100 a barrel? U.S. role in Iran-Israel fight fuels market jitters
Oil markets are entering a new phase of uncertainty after the U.S. entered the war between Iran and Israel, with experts warning of triple-digit prices. Investors are closely watching for Iran's reaction following the U.S.' strikes on its nuclear facilities, with Iran's foreign minister warning his country reserved "all options" to defend its sovereignty. Oil futures were up nearly 3% as of early Asia hours. U.S. crude oil rose 2.93% to $76 per barrel, while global benchmark Brent was up 2.86% at $79.22 per barrel. "There is real risk of the market experiencing unprecedented supply disruptions over coming weeks, of a much more severe nature than the oil price shock in 2022 in wake of the Ukraine war," said MST Marquee's senior energy analyst Saul Kavonic. While the market reaction post U.S. strikes has been less aggressive, relative to just over a week ago when Israel launched airstrikes against Iran, industry watchers believe that the latest developments usher in a new era of volatility for the oil markets, especially as they await for potential Iranian countermeasures. Threats of blocking Strait of Hormuz, after Iran's parliament approved closing it as per state media, have added to market jitters. The strait, which connects the Persian Gulf to the Arabian Sea, is a critical artery for global oil trade with about 20 million barrels of oil and oil products passing through it per day. That makes up almost one-fifth of global oil shipments. If Iran does close the Strait of Hormuz, Western forces will likely "directly enter the fray" and try to reopen it, Kavonic told CNBC, adding that oil prices could approach $100 per barrel and retest the highs seen in 2022, if the closure goes beyond more than a few weeks. "Even a degree of harassment of passage through the Strait, short of a full closure, could still see a serious heightening of oil prices," said the senior energy analyst. Kavonic's view is echoed by other industry experts. The U.S. and allied military would eventually reopen the Strait, but if Iran employed all its military means, the conflict could "last longer than the last two Gulf Wars," said Bob McNally, president of Rapidan Energy Group. And should Iran decide to attack Gulf energy production or flows, it has the capability to disrupt oil and LNG shipping, resulting in large oil and LNG price spikes. "A prolonged closure or destruction of key Gulf energy infrastructure could propel crude prices to above $100," he said. The CBOE crude oil volatility index, which measures the market's expectation of 30-day volatility in crude oil prices, is at March 2022 levels it hit shortly after Russia invaded Ukraine. While there has been some level of uncertainty with regards to how developments in the Middle East could play out for oil supplies, Lipow Associates' Andy Lipow noted that the current developments carry a different weight. "This time feels different, given the barrage of missiles that have been fired for over a week and now the direct involvement of the USA," he said, adding oil could hit $100 per barrel should exports through the Strait of Hormuz be affected. While an attempt to block the Hormuz waterway between Iran and Oman could have profound consequences for the wider economy, threats of blocking the strait have mostly been rhetorical, with experts saying that it is physically impossible to do so. "So the picture is a little bit mixed, and I think traders will err on the side of caution, not panicking unless there is more real evidence to do," said Vandana Hari, founder and CEO, Vanda Insights. Iran in 2018 threatened to close the Strait of Hormuz amid heightened tensions after the U.S. exited the nuclear deal and reinstated sanctions. Similar threat were issued in 2011 and 2012, when senior Iranian officials — among them then–Vice President Mohammad-Reza Rahimi — warned of a possible closure if Western nations imposed more sanctions on Iran's oil exports over its nuclear activities. Additionally, it is worth noting that Iranian energy infrastructure has not been a target thus far even with the recent conflagrations, said Rebecca Babin, senior energy trader at CIBC Private Wealth. "It appears that both sides have an incentive to keep oil out of the line of fire, at least for now," she said.
