Oil gains on growing unrest in Iran

Brent crude’s price has moved higher as unrest in Iran continued to escalate over the weekend.

IMAGE: Flags of the US and Iran. Getty Images

Oil market analysts are concerned that the ongoing protests in the OPEC member nation, calling for a change in regime, could threaten Middle Eastern oil supply.

“The oil market is facing increased supply risks amid intensifying protests in Iran,” two analysts from ING Bank said.

The development comes amid heightened geopolitical threats from another founding OPEC member – Venezuela.

Last week, Iran cut off internet services throughout the country to suppress the protests, after US President Donald Trump warned of possible US intervention if Tehran continued to attack protestors, Reuters reported.

Iranian Parliament Speaker Mohammad Bagher Ghalibaf warned that Washington would face significant retaliation, should it, or Israel, step in amid the unrest.

"Let us be clear: in the case of an attack on Iran, the occupied territories (Israel) as well as all US bases and ships will be our legitimate target," Reuters quoted Ghalibaf as saying.

The protests began about two weeks ago, with death toll now over 500, the report added. Iran is the fourth-largest OPEC member, producing around 3.2 million b/d of crude oil.

“This leaves a fair amount of supply risk hanging over the market,” ING Bank’s analysts added.

The market is now zeroing in on Iran, as concerns over short-term supply disruptions grow.

By Aparupa Mazumder

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