An oil price risk premium is back after Saudi drone strikes wipe out 5% of global supply
"Should the current level of outage be announced to last for more than six weeks, we expect Brent prices to quickly rally above $75 , a level at which we believe an SPR release would likely be implemented, large enough to balance such a deficit for several months and cap prices at such levels," Currie said.
"An extreme net outage of a 4 million barrels per day for more than three months would likely bring prices above $75 to trigger both large shale supply and demand responses," Currie said.The scale of the oil strikes "will encourage markets to re-examine the need for considering an oil geopolitical risk premium," analysts at risk consultancy Eurasia Group said in a research note published Saturday.
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