THE premium currently built into the crude oil price over tensions between the United States and Iran fluctuates according to the daily headlines, but there is an underlying assumption that everything will turn out fine. There is some debate as to the dollar number of the current risk premium, but the consensus range is around US$7 to US$10 a barrel. ScenariosThe crude market is therefore currently priced for one of two scenarios. The second is that there is no deal and Trump decides to use the forces currently being built up in the Middle East to attack Iran. While still the least likely outcome of the current tensions, the possibility of a severe escalation and sustained disruptions to crude supply is probably higher than the oil market believes.

Source: The Star February 20, 2026 01:10 UTC