Meanwhile, Energy watchers are keeping a close eye on Brent crude, which has retreated via recent multiyear highs nevertheless remains near $80 per barrel. President Donald Trump, who vowed “severe punishment” if Khashoggi was killed, is usually banking on the Saudis to tamp down energy prices, in addition to help offset lost Iranian supply.
“I think This particular could escalate very quickly in addition to oil is usually an obvious weapon for Saudi Arabia to use if there’s retaliation against the idea,” said John Kilduff of Again Capital. “If they’re going to be sanctioned economically they will make sure everyone else is usually going to feel pain as well.”
Although oil prices haven’t yet priced within the crisis, Saudi Arabia’s benchmark stocks tumbled sharply on Sunday. Kilduff warned that will the globe could witness “a period of instability in Saudi Arabia like we’ve never seen before,” he said.
Matt Smith, director of commodity research at ClipperData, suggested that will world oil prices were unlikely to be spurred by the Khashoggi mystery, “unless tension ratchets up dramatically via here. Although we have seen the Saudi equity market respond very negatively thus far, a risk premium in oil prices doesn’t seem warranted at This particular time.”
However, given the high stakes, FDD’s Schanzer added that will Kashoggi’s disappearance could embolden some other countries to take similar action against dissidents, if there were no reprisals.
“A dangerous precedent could be set, in addition to there needs to be a response,” Schanzer added.
—Reuters contributed to This particular report.