Two tankers were ablaze in Iraqi waters on Thursday after what appeared to be Iranian strikes, the latest wave of attacks on oil and transport facilities across the Middle East, as Iran warned the world should be ready for oil to hit $200 a barrel.
Unleashed with joint US and Israeli air strikes on Iran almost two weeks ago, the war has so far killed around 2,000 people and thrown global energy markets and transport into chaos. The conflict has spread across the Middle East and prompted plans for a record release of strategic oil reserves to dampen one of the worst fuel shocks since the 1970s.
The United Nations Children’s Fund (UNICEF) said more than 1,100 children had been killed or injured.
At a campaign-style rally in Kentucky ahead of November midterm elections in which his Republican party is trailing badly, U.S. President Donald Trump said the United States had won the war but didn’t want to have to go back every two years.
“We don’t want to leave early do we?” he said on Wednesday. “We got to finish the job.”
Iran has made clear it intends to impose a prolonged economic shock, with the spokesperson for Iran’s military command saying in remarks directed at the U.S. on Wednesday: “Get ready for oil to be $200 a barrel, because the oil price depends on regional security, which you have destabilised.”
Oil prices, which shot up earlier in the week to nearly $120 a barrel before retreating, jumped almost 10% back above $100 a barrel in Asian trade on Thursday amid renewed fears about supply disruption. Wall Street’s main share indexes fell and stocks in Asia followed suit.
Iranian explosive-laden boats appear to have attacked two fuel tankers in Iraqi waters setting them ablaze and killing one crew member after projectiles struck three merchant vessels in Gulf waters, port officials, maritime security and risk firms said.
“This appears to mark a direct and forceful Iranian response to the IEA’s overnight announcement of a massive strategic reserve release aimed at cooling runaway prices,” said Tony Sycamore, analyst at IG.
The International Energy Agency, made up of major oil consuming nations, on Wednesday recommended releasing 400 million barrels from strategic reserves to dampen one of the worst oil shocks since the 1970s, the biggest such intervention in history.
Trump said the IEA decision “will substantially reduce oil prices as we end this threat to America and the world.”
US Energy Secretary Chris Wright said Trump had authorized the release of 172 million barrels from the US Strategic Petroleum Reserve from next week.
