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The Iran drone strike & the oil market implications

There are clearly many ways in which tensions between Iran and Israel could escalate and push up oil prices following the Iranian drone strike at the weekend. But the risk that a conflict involving Iran disrupts oil production in the Gulf states is much lower now that it was back in 2018/19 when Iran was at loggerheads with the US and Saudi Arabia. Accordingly, the upside risk to oil prices and ultimately global inflation is smaller.

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