The oil price surges over 3% on Iran's missile attack on Israel, with an estimated 200 ballistic missiles used. U.S. military assisted in shooting down the barrage. An Israel, Iran war could be about to begin.

The Iranian missile attack on Israel for the 2nd time in 2024, as a retaliatory measure due to Israel assassination programs of Iranian backed military leaders, including a brazen assassination in Tehran by Israel's Mossad, killing Palestinian leader Ismail Haniyeh within a secure compound on July 31st and then Hezbollah's leader Hassan Nasrallah, who was killed in Beirut by an Israeli airstrike on September 30th.  The oil market has been reading the geopolitical situation in the Middle East as a low level conflict, and contained by U.S. double sided diplomacy, except the unpredictability is now coming from Israel's widespread pre-emptive aggression in the region.  Hence, the oil price now reflecting a possibility of an all out war occurring between Israel and Iran. 

The other issue is China's recession, with a stimulus that is geared more toward asset speculation, it may not offer much in the way of construction, and oil demand.  And China is a net importer of oil, from mostly Iran, is where things could get interesting for the oil market.  Say, a Straits of Hormuz blockade occurs, and or Iranian ships are bordered by U.S./allies to seize weapons on route to Hezbollah in Lebanon.  Which puts America/allies into the conflict with Iran.  China is a wildcard in that sense, maybe even Russia.

Hard to know what will occur, also harder to see how Biden's administration one month away from the U.S. elections will deal with this turmoil, be it that a war with Iran could be inevitable if Donald Trump takes the Oval office. 

With de-escalation as only a phrase these days, the oil price remains bid over $70, and could end up $80 per barrel, over a prolonged period of time, which will be akin to oil shock with inflation across the board.  Equals:  stagflation. 

News headlines:

• Iran launched nearly 200 missiles at Israel, U.S. says - WP

• Israel promises to retaliate after barrage of Iranian missiles fired in response to killings of Hamas, Hezbollah leaders - AJ

• Biden directed US military to help Israel shoot down Iranian missiles, White House says - Reuters