Collapse of Russia-Saudi Oil Deal Could Push Prices Down

As the market reaction to the strikes on Syria demonstrated, increased tensions in the Middle East often force oil prices higher. Until some easing of the markets Thursday, crude had been trading at the highest level in more than three years. Observers understandably worry about production disruptions or the interference in the shipping of crude oil in the Middle East – nearly a third of the world’s daily waterborne oil shipments pass through the Strait of Hormuz. General unease about heightened political and military tensions in the region can push prices higher even when these two risk factors are not present – and even when events occur in a place like Syria, which is a bit player in global oil markets.