Trump's strikes on Iran put markets on edge and bring oil prices back into focus
The US President has followed through with earlier threats to attack Iran in a move that could lead to further volatility for markets and the global economy.
US President Donald Trump's decision to strike nuclear sites in Iran is set to dominate the week in geopolitics and could upend the macroeconomic outlook with investors bracing for a potential spike in oil prices as a consequence of the historic move.
Trump on Sunday (Australian time) confirmed that US warplanes had hit three targets in Iran, just days after he said he would decide “within the next two weeks” whether the US would join Israel’s military campaign against the country.
Ahead of the move, analysts from Barclays said in a note that Brent crude oil prices, "the main risk channel for the global economy" could rise above USD100 per barrel if there was an escalation in the conflict.
"In our estimates, a reduction in Iranian oil exports (not seen yet) could push Brent above $80/b, while a worst-case scenario of a wider conflagration, including a closure of the strait of Hormuz, could push prices past $100/b" they wrote.
