Hussein Sayed, chief market strategist at FXTM, is considering the implications of the fires in Saudi Arabia.
“What we know so far is that the attack has caused a disruption of 5.7 million barrels a day, which is almost 5% of global oil supply. This makes it the biggest supply shortage shock in history. Now everyone seems to have the same question; when can Aramco return to normal production? Unfortunately, we don’t yet have a decisive answer.
“Three days ago, oil prices hitting $100 a barrel was almost an impossible scenario. Not anymore. That’s not just because of the current disruption from Saudi Arabia, but the fact that the chances of military conflict in the region have risen dramatically.
“The next couple of days and weeks will be of incredible importance to the global economy and markets, so keep a close eye on further developments.”