Oil prices reached fresh six-month highs following a tough ultimatum from Donald Trump. The U.S. President stated that Tehran has a maximum of 10-15 days to reach an agreement on its nuclear program, reports Bloomberg.
Brent has broken the $72 mark per barrel (up more than 6% for the week), WTI is trading near $67.
The U.S. has carried out the largest increase in military presence in the Middle East since 2003. This may indicate preparations for a larger campaign than the targeted strikes on nuclear facilities carried out last June. According to WSJ, Trump is also considering a limited strike option to compel Tehran to negotiate.
The main risk is a possible blockade by Iran of the Hormuz Strait, a key artery for transporting oil from the Persian Gulf.
High oil prices pose risks for Trump himself: rising gasoline prices could anger voters ahead of the midterm elections at the end of the year. Additional support for prices came from statistics from the U.S.: crude oil stocks fell by 9 million barrels in a week — the sharpest drop since the beginning of September.