Crude oil prices ticked upward Monday morning as the U.S. considers how to respond to concerns that Saudi Arabia was involved in the disappearance and possible death of a popular Turkish journalist.
Prices increased 44 cents for WTI crude and 81 cents for Brent crude as rhetoric between the U.S. and Saudi Arabia heats up over the possible killing of Jamal Khashoggi.
Turkish officials say The Washington Post columnist was spotted entering the Saudi consulate earlier in October but was never seen leaving. Officials suspect Saudi Arabia dispatched a team of 15 assassins to the consulate to kill, dismember and dispose of Khashoggi after he entered the site.
President Donald Trump said Sunday night that he is dispatching Secretary of State Mike Pompeo to Riyadh to investigate the matter. He also said that King Salman of Saudi Arabia told him in a phone call that the Saudi regime denies having any knowledge about Khashoggi’s possible death.
Trump initially said there would be “severe punishment” if the Saudis were responsible. Saudi Arabia released a statement
Saudi Arabia is the world’s largest crude oil exporter and one of the world’s largest and most influential producers. Any effort to weaponize oil production could seriously hurt energy markets at a time when oil prices are ticking upward over other geopolitical skirmishes.
Other Saudis are issuing similar warnings. The general manager of Saudi-owned Al Arabiya News Channel, Turki Aldakhil, for instance, published a column suggesting U.S. sanctions could send oil prices to $200 or even higher. (RELATED: Trump Calls Saudi King About Missing Dissent)
Some analysts believe Trump’s decision to reimpose sanctions on Iran’s oil industry are causing prices to skyrocket.
Sanctions are taking their tolls on Iran’s once-thriving oil industry. The country’s oil exports averaged 2.1 million barrels per day over the past year, and analysts say sanctions will likely take between 500,000 and 1 million barrels per day off the market.
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