For indispensable reporting on the coronavirus crisis and more, subscribe to Mother Jones’ newsletters.Oil prices are cratering! No, wait: oil prices are up! Maybe we’ll get into a war with Iran!
West Texas Intermediate futures that will deliver oil in June, the U.S. benchmark, rose 20% to $16.47 a barrel. Brent crude futures, used to set prices for oil throughout global energy markets, rose 8.6% to $22.12 a barrel.
Helping prices regain some lost ground: signs of a recovery in demand for oil in China, which is emerging from coronavirus lockdowns, and tensions between the U.S. and Iran….“When you look at China, road traffic and refinery operations are back up,” said Norbert Rücker, head of economics at Swiss private bank Julius Baer. “Don’t forget the geopolitical side too,” he added, referring to the potential for U.S.-Iranian tensions to disrupt the movement of oil through the Strait of Hormuz, a vital channel for tankers.
President Trump has ordered US ships to shoot at Iranian gunboats that play games in the Strait of Hormuz, possibly in hopes of sparking a confrontation that would . . . what? Spur Iran to sink a tanker or something? Who knows. But the good news is that it might increase the price of oil by a buck a barrel!