Israel retaliation may target Iran oil infrastructure, boosting prices further, Wall Street analysts say
The Iranian flag above the new Phase 3 facility at the Persian Gulf Star gas condensate refinery in Bandar Abbas, Iran, in 2019.
Ali Mohammadi | Bloomberg | Getty Images
The oil market faced a rude awakening this week after Iran launched a large-scale ballistic missile attack against Israel, briefly sending crude prices more than 5% higher Tuesday after a period of sleepy trading.
For months now, traders have largely dismissed the risk of a supply disruption in the Middle East. Instead, bearish sentiment swept the market in September as investors increasingly fear a surplus next year due to softening demand in China and increased production from OPEC+.
The expanding war in the Middle East, however, has reached a new boiling point as Israel has vowed a “painful” response to Iran’s attack. The government of Prime Minister Benjamin Netanyahu could take aim at the Islamic Republic’s oil infrastructure in retaliation, geopolitical and crude market analysts say.
“There has been a lot of complacency about this war,” Helima Croft, head of global commodity strategy at RBC Capital Markets, said Tuesday on CNBC’s “The Exchange” shortly after the attack. “We do need to think about a scenario where Iranian oil supplies are at risk.”
Israel could also take aim at Iran’s nuclear facilities, but those buildings are hardened, making them difficult to destroy, said retired U.S. Army Col. Jack Jacobs. A strike on those facilities could trigger an even larger ballistic missile attack by Iran that would be difficult to defend against, he said.
“What is really on the table now and is more likely is an attack on oil facilities,” Jacobs said Wednesday morning on CNBC’s “Squawk Box.”
OPEC member Iran is producing at a five-year high of more than 3 million barrels per day, Croft said. U.S. intelligence in the past has highlighted the potential risk to Iran’s Kharg Island oil terminals, through which 90% of the country’s crude exports pass, according to a Tuesday note from RBC Capital Markets.
“The next turn in this retaliation spiral may very well involve oil – via the degrading of Iran’s oil capacity or Iran’s proxies attacking oil and gas shipping from the Persian Gulf,” Piper Sandler analysts told clients in a Wednesday research note.
The impact on the oil market would depend on the damage done to Iranian crude exports and how the situation escalates from there, said Bob McNally, president of Rapidan Energy. If Iran’s oil exports of around 1.8 million bpd were taken offline, prices would likely jump by at least $5 per barrel, McNally said.
Iran, in turn, would likely retaliate by threatening the 13 million bpd of crude and 5 million bpd of products that are produced in and flow through the Persian Gulf, McNally said. An escalation on this scale could send oil prices higher in increments of $10 per barrel, the analyst said.
“These are dangerous times for oil markets at the moment,” Andy Critchlow, EMEA head of news at S&P Global Commodity Insights, told CNBC’s “Street Signs Europe” on Wednesday. “It’s hard for anyone in the market to really gauge the direction when you look at the amount of geopolitical risk that is out there.”
OPEC, however, has 5.6 million bpd of spare capacity that can be brought back to the market with Saudi Arabia keen to return as much of its oil back to the market as possible, Critchlow said.
“Any disruption to Iranian supplies to the international market I think could be made up by spare OPEC capacity and it’s idled oil at the moment,” the analyst said.
McNally, however, said this oil won’t mean much if there is a major disruption in the Persian Gulf. “Spare capacity won’t help because it’s mostly bottled up inside the Strait of Hormuz,” the analyst said.
The Mockingbird Solar Center, Ørsted’s largest solar project globally, is now online, next to protected prairie donated by the renewable energy giant.
This massive 468-megawatt (MW) solar farm is set to power 80,000 homes and businesses, providing a major boost to the Texas grid.
But the launch of Mockingbird Solar isn’t just about clean energy – it’s also about restoring precious ecosystems. Ørsted has donated 953 acres of the Smiley-Woodfin Native Prairie Grassland, which sits next to the solar center, to The Nature Conservancy. The donated land is now the Smiley Meadow Preserve, a protected area for tallgrass prairie that’s home to more than 400 species of grasses and wildflowers.
Tallgrass prairies are some of the rarest ecosystems in the US, with less than 1% of Texas’ original tallgrass prairies still in existence. Tallgrass prairie does a lot of heavy lifting for the environment, including storing carbon, preventing floods, and providing crucial habitats for pollinators.
“Native prairies are the rarest landscapes left in Texas – so much so that many people have never seen one,” said David Bezanson, land protection strategy program director for The Nature Conservancy in Texas. He added that preserving Smiley Meadow will not only conserve one of the best prairie remnants left but also help restore other prairie habitats and boost regional biodiversity.
The Mockingbird Solar Center, a half-billion-dollar project, is part of Ørsted’s $20 billion push to expand renewable energy production across the US. Beyond generating electricity, it will inject $75 million into local property taxes, benefiting schools and other public services. The project also created over 550 construction jobs and will continue to be supported by operations staff moving forward.
Ørsted worked with US companies, including First Solar, for solar panels and partnered with local businesses like Drake Construction and Pfifer Farms for construction materials. It also gave more than $50,000 to local volunteer fire departments in Roxton and Brookston.
With Mockingbird Solar now up and running, Ørsted has more than 6 gigawatts of onshore wind, solar, and battery storage projects either in operation or being built across the US.
Read more: Ørsted got a huge Tesla battery storage system for the world’s single-largest offshore wind farm
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Jeep’s first global luxury electric SUV will arrive at US dealerships any day. Despite its $72,000 price tag, lease prices for the 2024 Jeep Wagoneer S EV start at just $599 per month.
2024 Jeep Wagoneer S EV lease prices
After unveiling its first global electric SUV, Jeep’s CEO said the Wagoneer S “marks a new chapter” in its storied history.
Jeep claims the Wagoneer S packs “exhilarating performance.” With 600 hp and 617 lb-ft of torque, the big-body SUV can sprint from 0 to 60 mph in just 3.4 seconds. Its 100 kWh battery pack also gives it a driving range of over 300 miles.
The electric SUV is unmistakably still a Jeep, but it did get several upgrades to distinguish it as an EV. The grille is now enclosed without the need to cool a massive engine, giving it a sporty, more modern look.
Jeep revamped its design with a new illuminated seven-slot grille with ambient cast lightning. It also fine-tuned its profile, adding flush door handles, a rear wing, and integrated fins for better airflow.
The first Jeep Wagoneer S Launch Edition models get exclusive dark accent design elements like 20″ Gloss Black Wheels.
Inside, the electric SUV is loaded with the latest tech and connectivity, including a best-in-class 45″ of usable screen space. The setup includes a 12.3″ center screen and an exclusive 10.25″ interactive front passenger screen.
Jeep already announced that the 2024 Wagoneer S EV will start at $71,995, but now the company has revealed lease prices for the first time.
According to Jeep, the 2024 Jeep Wagoneer S Launch Edition can be leased for $599 per month for 36 months (10,000 miles per year). The deal includes $4,999 due at signing and a $7,500 EV incentive. However, you may want to act fast, as Jeep’s offer is only good until December 2, 2024.
| Jeep Wagoneer S vs Tesla Model Y | Starting Price | Range | Lease Price |
| Jeep Wagoneer S Launch Edition | $71,995 | +300 miles | $599/mo |
| Tesla Model Y RWD | $44,990 | 320 miles | $299/mo |
| Tesla Model Y AWD | $47,990 | 308 miles | $399/mo |
| Tesla Model Y AWD Performance | $51,490 | 279 miles | $599/mo |
In comparison, Tesla Model Y RWD lease prices start at $299 for 36 months with $2,999 down (10,000 miles). The Performance AWD model starts at $599 per month. In an end-of-year promo, Tesla also offers 3 months of free Supercharging and Full Self-Driving.
Ready to drive off in your new electric SUV? We can help you get started. You can use our links below to view offers on the Jeep Wagoneer S and Tesla Model Y at a dealer near you.
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