Brent Prices Spike As Russia Gets Involved in Syria-Turkey Conflict
Brent crude oil saw a spike on Thursday and ended trading above $115 after tensions between Syria and Turkey became even more heated.
Russia got involved on Thursday when officials in Moscow said Russian lives were endangered when a Syrian plane was forced down and searched for military equipment. There was much speculation as to whether or not the plane was actually carrying any illegal military equipment. The BBC reported that Turkish Prime Minister Recep Tayyip Erdogan confirmed that there was in fact Russian-made military equipment destined for Syria on the plane. However, Syrian and Russian officials claim that these accusations are false, and have demanded to see proof of the seized ammunition and equipment.
Whether or not the plane was carrying military paraphernalia, the incident serves to highlight the growing and spreading tension between the two nations. Many fear an oil supply interruption is imminent, as the conflict slips further from resolution.
Friday morning, Brent crude traded at 113.54, leveling off after Thursday's news. The commodity remains supported by the tension between Turkey and Syria, but gains have been moderated by the global economic slowdown and worries that the future demand for crude oil will be limited.
In the midst of a supply and demand tug-of-war, Brent has seen its share of dips and spikes this week. But news from the US that major companies like Royal Dutch Shell and BP are obtaining export permits could result in changes in the market. The Economic Times reported that if these permits to export oil overseas play out, it could force Brent prices to waver.
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