Military Actions against Iran to Double Oil Prices: American Expert
Azerbaijan, Baku, 1 July /corr. Trend A.Badalova / Iran's cessation of oil production and export in case of possible military actions in the country would raise prices by 100%, said Nasir M. Khilji, international economist of the U.S. Energy Information Agency (EIA).
The USA and other several countries accuse Iran of striving acquiring nuclear weapons. The USA and Great Britain repeatedly made statements on necessity to toughen sanctions with regards to Iran.
"Clearly anything that limits oil production anywhere in the world is bound to increase the oil price. Iran supplied about 4 million barrels per day (MBD) in 2007 relative to a world total of 85 MBD which is about 5%. Complete stop in Iranian production would raise prices by 100%," Khilji told Trend on 1 July. According to him, at present prices are about $135/barrel.
Many western economic experts support Khilji's opinion and consider that military actions against Iran will significantly increase oil prices.
The economic analyst of British newspaper the Independent, Shon O'Gradi considers that the oil prices may temporarily increase up to $200 per barrel. "In the unlikely event of war then the price is anyone's guess! Say $250," O'Gradi told Trend earlier.
This week, oil prices stuck absolute records, exceeding $143 per barrel. Brent oil being produced in the North Sea increased on 30 June by $3.6 per barrel up to $143.91. The cost of July futures for the American light oil increased by $3.46 per barrel and made up $143.67 per barrel.
The price rise was caused by the sequential tension in the relations between Iran and on the one hand Israel and on the other hand USA. Iran highlighted blockade of Strait of Hormuz in case of attack by Israel, which considers the nuclear program of Iran as the basic threat for its security. Approximately 40% of the world oil export or 80-90% of the oil, produced in the countries of the Persian Gulf is transported Strait of Hormuz, which connects the Persian and Oman Gulfs of Arabian Sea. Thus, even the short-term cessation of oil supplies can lead to the serious consequences for the world economy.
In response to Iran's statement presenting threats for the entire world, the USA stated it will not allow Iran to blockade strategically important gulf. The Command of the U.S. Air Forces, Kevin Gosgriff, said that each effort of Iran to blockade Strait of Hormuz will be assessed as military action, but the USA will never allow it.
The correspondent can be contacted at: [email protected]