Energy Report: Middle East Tensions Rising

Oil prices are rising, hitting the highest level in Brent crude since May of 2019 as tensions between Iran and Israel are a lot more dangerous than we knew. The Wall Street Journal reported that Israel has targeted at least a dozen vessels bound for Syria and mostly carrying Iranian oil, out of concern that petroleum profits are funding extremism in the Middle East, U.S. and regional officials say, in a new front in the conflict between Israel and Iran.

The Journals says that “Since late 2019, Israel has used weaponry including water mines to strike Iranian vessels or those carrying Iranian cargo as they navigate toward Syria in the Red Sea and other areas of the region. Iran has continued its oil trade with Syria, shipping millions of barrels and contravening U.S. sanctions against Iran and international sanctions against Syria. Some of the naval attacks also have targeted Iranian efforts to move other cargo including weaponry through the region, according to U.S. officials. The attacks on the tankers carrying Iranian oil have not been previously disclosed. Iranian officials have reported some of the attacks earlier and have said they suspect Israeli involvement.

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Image Source: Unsplash

This comes as Reuters reports that, “The United States repeated on Thursday it will not offer Iran unilateral incentives to attend talks about both sides resuming compliance with the 2015 Iran nuclear deal. “We will not offer any unilateral gestures or incentives to induce the Iranians to come to the table. If the Iranians are under the impression that, absent any movement on their part to resume full compliance with the (nuclear deal), that we will offer favors or unilateral gestures, well that is a misimpression,” State Department spokesman Ned Price told reporters.

For oil, this is another factor. The Biden administrations' desire to lift sanctions on Iran will not happen anytime soon. Israel is dead set against a sanction lifting as Iran continues to fight proxy wars in the region. The drone attack by the Iranian-backed Houthi rebels on a Saudi oil terminal is not exactly the way Iran can go and win friends and influence people. 

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