International oil prices spiked to a one-month high after President Trump ordered missile strikes against Syrian military infrastructure in response to a chemical weapons attack for which security sources held responsible the Bashar Assad government.
The strikes hit a military airport and related targets, killing six. The strikes comes just a week after U.S. ambassador to the UN said that removing Assad from power was no longer a priority for the U.S.
The Syrian side has denied responsibility for the attack, calling the air strikes “an aggression”. Assad’s main allies in the region, Russia and Iran, have also condemned the move, with Russia’s President Putin saying that it violated international laws and would worsen relations between the U.S. and Russia.
The Western world has welcomed the direct U.S. involvement, as have Saudi Arabia, Turkey, and Israel.
All markets reacted immediately to the strikes, with crude oil the obvious big winner: WTI jumped over $52 a barrel, and Brent passed the $55 mark.
Although Syria itself is not a major oil producer, especially in the last few years while the civil war has been raging, it neighbors Iraq; any increase in tension within Syria is likely to reverberate across the Middle East and beyond, especially now that the latest events have put the U.S. and Russia at odds. Related: Obliterating ISIS May Hamper Iraqi Oil Production
The chemical weapons were released after an airstrike by the Syrian army over rebel-held Khan Sheikhoun, in the province of Idlib. Examination of some of the victims in Turkey has suggested that they were exposed to sarin, a neurotoxin that the Assad government has a history with. The Syrian government claims that the weapons were released accidentally when its air strikes hit a storage facility of the rebels.
The situation in Syria is becoming increasingly complicated, which is bound to continue to reflect on oil prices, most likely keeping them higher for longer, until the main actors in the play mull over their next moves.
By Irina Slav for Oilprice.com
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