Oil prices surge as Middle East turmoil fuels market tension
Oil prices on the fuel exchange in New York are rising. Brokers report that investors' attention is focused on the Middle East after the death of the Iranian president and due to the illness of the Saudi Arabian king.
Oil prices on the fuel exchange in New York are rising. A barrel of West Texas Intermediate oil costs CAD 109.67 on NYMEX. Brent on ICE costs CAD 115.25 per barrel.
In the markets, investors' attention is focused on the Middle East after the death of the President of Iran.
President of Iran Ebrahim Raisi, Foreign Minister Hossein Amirabdollahian, and several other high-ranking Iranian officials died in a helicopter crash near Jolfa in Iran's East Azerbaijan province, the Iranian Red Crescent reported on Monday at 7:00 AM ET.
The helicopter crashed into the side of a mountain and completely burned.
Presidential elections in Iran
The disaster occurred when President Raisi returned from the dam opening ceremony on the Aras River on the Iran-Azerbaijan border, in which he participated with Azerbaijani President Ilham Aliyev.
The Iranian constitution states that in the event of the president's death, the first vice president—currently Mohammad Mokhber—will take office with the approval of the Supreme Leader Ali Khamenei. After 50 days, presidential elections will be organized.
President Raisi was seen as a favourite to succeed Supreme Leader Ayatollah Ali Khamenei, the highest authority of the Islamic Republic.
Meanwhile, the Saudi Press Agency reported that the King of Saudi Arabia, Salman Bin Abdulaziz, is to be treated for a lung disease. King Salman is the head of the world's largest oil exporter.
Russian refinery on fire. Work suspended
Market players are also observing events related to Russia's war in Ukraine.
Ukrainian drones hit the Russian Kuschevskaya airport and Sloviansk oil refinery in the Krasnodar region on Saturday evening, Interfax-Ukraine reported. The airport in Russia hosted many planes that attacked Ukrainian positions on the front line.
After the attack of Ukrainian drones, which hit rectification and atmospheric columns, the refinery in Sloviansk suspended its work.
An oil tanker going from Russia to China is hit by a Houthi missile in the Red Sea - the U.S. Central Command reported.
The tanker was hit by a missile near the Bab el-Mandeb Strait, about 19 kilometres from the Yemeni port of Mokha.
Attacks on merchant vessels in the Red Sea
Iran-backed Houthis have been attacking warships and merchant ships passing through the Red Sea since mid-November 2023, especially those linked to Israel, the U.S., and the U.K., in response to Israel's war with Hamas in the Gaza Strip.
The Houthis "effectively" closed a key global shipping route, forcing many ships navigating between Europe and Asia to avoid the Suez Canal and circle southern Africa.
According to analysts, events in the Middle East may stimulate demand for safe havens on Monday, although oil and other commodity prices are not changing much for now.
