A disruption in oil and gas shipments from West Asia looks improbable at this point of hostility between Israel and Iran, but it could lead to inflationary pressure as speculators play on risk premia to keep prices on the boil. Benchmark Brent had surged past $90 per barrel in the wake of Iran’s April 13 missile attack on Israel but soon slipped to $87. On Friday, Brent declined further to $86.4 after Tehran played down reported Israeli attacks on Isfahan, raising hope against escalation of hostilities in the region.
Asian shares retreated on Friday as hawkish comments from some Federal Reserve officials and escalating geopolitical tensions put a dent in risk sentiment, while traders were also cautious ahead of U.S. jobs data due later in the day. The threat of supply disruptions owing to a prolonged conflict in the Middle East kept Brent futures above $90 a barrel.
