News Commodities

Oil Prices in the Course of the Israel-Iran Conflict

News Commodities 18 June 2025

Since the escalation of the conflict between Iran and Israel, which intensified notably around June 13, 2025, oil prices for both West Texas Intermediate (WTI) and Brent Crude have experienced significant volatility. The conflict, marked by Israeli airstrikes targeting Iran's nuclear and oil infrastructure, triggered immediate reactions in global oil markets, driven by fears of supply disruptions in a region critical to global oil production. This analysis outlines the price movements since the conflict's outbreak and explores potential factors influencing future trends.

Oil Price Development Since the Conflict's Outbreak

The conflict's escalation on June 13, 2025, led to sharp increases in oil prices. Brent Crude, the European benchmark, surged by up to 13% overnight, reaching a peak of $78.50 per barrel, the highest since January 2025. By June 17, prices had moderated but remained elevated at around $74.93 per barrel, reflecting a 5.5–7% increase from pre-conflict levels. Similarly, WTI, the U.S. benchmark, jumped by approximately 6–9%, climbing from around $68.15 to $73.87 per barrel by June 17, with intraday highs near $74.64. Posts on X and various reports confirm these movements, noting the largest single-day gains since 2020, driven by heightened geopolitical tensions.

By June 16–17, markets showed signs of stabilization. Brent and WTI prices retreated slightly from their peaks, with Brent at $74.08–$75.18 and WTI at $73.16–$73.87. This partial pullback reflected market perceptions that the conflict might remain contained, coupled with reassurances from the International Energy Agency (IEA) about adequate global oil supplies and reserves of 1.2 billion barrels. However, prices remained above pre-conflict levels, incorporating a risk premium due to ongoing uncertainties.

Factors Influencing Future Oil Price Trends

Geopolitical Risks and the Strait of Hormuz: The conflict's potential to disrupt oil flows through the Strait of Hormuz, a chokepoint for roughly 30% of global seaborne oil trade, remains a critical concern. Iran, a major OPEC producer with 3.6–4 million barrels per day (mbpd) of output, could attempt to block this route in retaliation, potentially driving prices to $100–$150 per barrel, as speculated in some analyses. A blockade or attacks on regional oil infrastructure (e.g., in Saudi Arabia or the UAE) could exacerbate supply fears, pushing prices higher.

Sanctions and Supply Constraints: The U.S. and EU have signaled tighter sanctions on Iran, which exported significant volumes to China in 2023 despite existing restrictions. Stricter enforcement could reduce Iran’s 4% share of global supply, tightening markets. Conversely, OPEC’s spare capacity of over 6.5 mbpd, primarily from Saudi Arabia, could mitigate short-term disruptions, capping price spikes unless the conflict escalates further.

Global Economic Conditions: Weak global demand, particularly from China, has exerted downward pressure on oil prices in 2024, with Brent briefly dipping below $70 in September. A sluggish world economy in 2025 could continue to limit price gains, as forecasted by analysts like Goldman Sachs, who predict Brent at $70 by year-end 2025 due to an expected supply surplus of 0.8 mbpd.

OPEC+ Production Policies: OPEC+ decisions on production quotas will be pivotal. If the cartel maintains or increases output to offset potential Iranian losses, prices could stabilize. However, any reluctance to boost supply amid rising tensions could sustain elevated prices.

Market Sentiment and Speculation: Oil markets are highly sensitive to speculative trading. The current backwardation in futures markets suggests near-term supply concerns, but a shift to contango could signal expectations of oversupply. Investor sentiment, influenced by news cycles and de-escalation signals (e.g., potential nuclear talks with Iran), will drive short-term volatility.

Possible Development of Oil Prices

Oil prices remain heavily dependent on the development of the conflict. De-escalation, for example through negotiations on the Iranian nuclear programme, could reduce the risk premium and stabilise prices. Experts are forecasting an average Brent price level of around USD 70 for 2025, provided there are no major disruptions. However, strong fluctuations are possible in the short term, particularly if the conflict intensifies or the Strait of Hormuz is blocked. As early as Tuesday, only the suspicion of US intervention triggered a rise in oil prices in the night to Wednesday, which was partly given up again in the absence of US attacks, but returned to Tuesday's level by midday on Wednesday. This shows that the volatility of oil prices could remain at a high level.

Gold starts the week at a All-Time High

News Commodities 10 February 2025

As the week began, the gold price has already equalled its record high from Friday and has risen above the USD 2,890 mark.

Interest in Gold continues to rise

As the latest CoT report shows, the number of net open long positions is rising among both major speculators (+1%) and small investors (+5.8%). In early trading this week, this is reflected in a new all-time high for XAU/USD at USD 2,896.

New tariffs make their contribution

The renewed announcement of tariffs by the US government may have contributed to this development. These now affect steel and aluminium imports and are set to amount to 25%. In addition, US President Trump has announced that he will impose tariffs imposed by other countries on US goods on imports of these goods into the US. As further tariffs will also affect inflation in the US, this could have a negative impact on the stock market and drive the price of gold to new record highs.

Data on US crude oil inventories puts pressure on oil prices

News Commodities 22 November 2023

After a brief recovery, crude oil prices have fallen significantly following the publication of the figures on US oil reserves. The postponement of the OPEC meeting is also having a negative impact on oil prices.

After recovering somewhat in recent days, oil prices came under renewed pressure on Wednesday due to the publication of data on crude oil and distillate reserves in the United States. Contrary to the expected increase of 1.16 million barrels, reserves rose by 8.701 million barrels compared to the previous week. Petrol stocks also rose by 0.749 million barrels against an expected decline of -0.150 million barrels. The price of a barrel of Brent crude fell below the mark of $80 in the meantime. It has since risen above this mark again and is trading at around $81.60 per barrel. US WTI fell to $73.85, but has since recovered to just under $77 per barrel.

The postponement of the OPEC meeting scheduled for the coming weekend to 30 November is also unsettling the market. Although no reason was provided for the postponement, according to Bloomberg there are disagreements between the OPEC members about the oil cartel's production policy. This is apparently due to the fact that some members do not want to follow the example of Saudi Arabia, which has already voluntarily reduced its production volume. If this becomes reality and is implemented, it could exert considerable pressure on oil prices in addition to concerns about the global economy.

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Gold price remains at the $2,000 mark

News Commodities 22 November 2023

After falling back below the mark of $2,000, which was broken yesterday, the gold price was able to break through again this morning.

The gold price has shown an impressive upward trend in recent weeks. Since 11 October, the price per troy ounce of gold has risen by around $70. On the one hand, this was due to the cooling economic outlook in the major economies. As a result, the market now assumes that the US Federal Reserve has reached the end of its interest rate hikes. Although the minutes of the FOMC meeting published yesterday indicate that it intends to maintain its aggressive monetary policy for the time being, the meeting took place a fortnight ago. The US economic data published in the meantime takes some of the sharpness out of the Fed's statements.

The fact that the statements in the minutes were not seen as very dramatic by the market was demonstrated by the fact that they were unable to provide any real relief for the currently weakening US dollar. This of course benefitted gold, to which investors traditionally turn when the dollar weakens. The fact that yesterday's statements by ECB Chairwoman Lagarde indicated that the European Central Bank would not raise interest rates any further for the time being and would initially monitor further developments certainly also had a supportive effect.

The gold price could receive further inspiration today when the data on new orders for durable goods and the weekly figures on unemployment claims are published in the United States. Gold is currently trading at 2,001.60, just above the important mark.

Oil prices fall, WTI oil drops below USD 80 per barrel

News Commodities 07 November 2023

Oil prices continue to fall on Tuesday. Weak data from China is raising fears of a decline in demand for crude oil.

After oil prices were unable to find a clear direction yesterday, the price of US WTI crude fell below the mark of $80 per barrel in early trading today. This is the lowest level since the end of August. While no clear trend was discernible yesterday, the price of WTI oil now appears to be stabilising below $80 for the time being. The price is currently down around 1.75% at $79.35. The situation is similar for North Sea Brent crude. The price of Brent is currently down by around 1.80% and is trading at $83.60 per barrel.

Data on the Chinese trade balance in particular is having a negative impact on oil prices. While analysts expected exports from China to fall by 3.3% in October, the figure now published was almost twice as high at 6.4%. This reinforces fears that demand for oil from one of the most important oil-importing countries could fall significantly. In addition, the interest rate hike in Australia is also contributing to the pressure on oil prices. This is fuelling concerns that central banks around the world have not yet reached the end of their interest rate hikes. This could have a negative impact on the global economy and therefore also on the demand for oil.

However, it remains to be seen how the member states of OPEC+ will react to the fall in prices. As is well known, they want to keep the oil price above the mark of $80 per barrel. To this end, they had already agreed at their last meeting to reduce production by around 1.39 million barrels in 2024.

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