THE FATE OF INTERNATIONAL CRUDE OIL PRICE
Crude oil had been indirectly used as a vital weapon in national conflicts and crisis occurring in the middle east (of which in some way, Iran and America were involved ).
During the Yum Kippur war of 1973, some Arab nations of OPEC placed an embargo on oil exploration to the United States of America for its allegiance to Israel . in addition to other consequences this ban brought, was the increase in the price of crude oil in the international market.
Recently, the commander of the Quds Force and Iran’s second most influential man, Qassem Soleimani was assassinated by an airstrike ordered by US President, Donald Trump. This recent occurrence brought with it, pessimistic feelings globally as per its implication in the price of the liquid black gold (crude oil) if perhaps, Iran retaliates.
Would History repeat itself, or would the price of oil and its availability be averted via modern and diplomatic measures even if the most predictable scenario – a war occurs
Already, Oil sanctions had been placed on Iran before the death of Major General Soleimani. Although, the result of the sanction in the global distribution and availability of crude oil was not evident as some had thought.
However, several sources revealed that the bombing of the Saudis oil installation is in a way, repercussive of the aforesaid. Certainly, this destruction reduced worldwide oil supply by 5%.
More so, the current conflict between Iran and the USA would for sure disrupt oil supplies for certain reasons
GOREILLA WARFARE-AMBUSH TO THE USA AND HER ALLY ALTERNATIVE OIL SUPPLIES
Generally speaking, the united states of America has a more technologically advanced army as compared to Iran. But Iran is bitterly grieved over losing one of her finest, so it would hold fast to her little might by effectively using it.
One of such is the use of chemical weapons. Another is halting oil distribution. Clearly , about 18 million barrels of oil leave the Persian Gulf region daily -more so, giant vessels loaded with natural gas.
However, these fossil fuels from this area must be transported via The Strait of Hormuz. This route separates the united Arab Emirates, Oman, and Iran and leads to the Indian ocean. Vehicles enrouting this way are prone to ambushes and airstrikes if Iran-USA menace happening in the status quo persist or even escalates.
Evidence of the viability of this prediction, can be referenced to a similar occurrence that happened last year(2019). A number of tankers leaving the aforesaid region were seized.
This was alleged, in bid to show that if Iran cannot export oil due to sanction it faced, then other producers in the area are liable to certain resistances in their oil exportation
A PENNY FOR THOUGHT
Nevertheless, the current situation can be seen as a two-sided coin. The reason for this being that, this might mean good news for certain African countries weeping over the downgrade in the crude oil price which has lasted for 6 years now.
Multinational (American) oil companies present in the middle east particularly Iran, should be prepared for the worst. Possibly key areas can be locomoted to other branches of theirs outside these potential core areas of conflict.
Taking both sides into consideration, if the Iran-America issue escalates and possibly skyrockets crude oil price, then their branches in Africa and America would benefit from increased profits even if those in the middle east suffer closure or increased losses.