Inflation Questions
Inflation concerns are rising again as an escalation of the US-Iran war puts renewed upward pressure on oil prices. The cost of a barrel of Brent crude briefly rose above $100 for the first time since late May as not one but two crucial waterways for oil transport are under attack. Iran has effectively closed the Strait of Hormuz again, while its allies in Yemen, the Houthis, attacked shipping in the Bab-al Mandeb Strait. The latter impacts Saudi Arabia’s ability to export oil from Yanbu on its western coast. Saudi oil will now have to travel through the Suez Canal and around South Africa to reach Asian markets, a much longer and more costly exercise.