KUCHING: The disruption in oil supply and rise in prices caused by the ongoing US-Iran crisis is likely to be temporary as an escalation of the tensions between US-Iran is unlikely.
Quoting MIDF Amanah Investment Bank Bhd’s research team (MIDF Research) in Borneo Post, it pointed out that both US and Iran have come to a stand-off following the US drone attack in Iraq and counter-attack by Iran.
However, it pointed out that many believe the crisis is expected to continue.
It further opined that should any escalation resulting from the attacks or rise in internal pressure happens, it will potentially result in a target placed on US-related assets and oil-related assets, which in return could lead to a temporary disruption in oil supply and rise in oil price.
It also believed that there will be a temporary knee-jerk reaction towards the oil price, should there be an escalation of attack.
On the other hand, should the current stand-off between the US and Iran remains; the research team opined that it would lead to a more sustainable oil price movement and a more stable outlook for the oil and gas industry.