On November 1, 2024, oil prices experienced a significant increase, with Brent crude rising by over 1.5% to $74.74 per barrel, and West Texas Intermediate gaining similarly to reach $71.04 per barrel. This surge follows a 2.5% rise the previous day.
Israeli Prime Minister Benjamin Netanyahu announced intentions to respond to Iranian aggression, although specific details were not disclosed. According to US news outlet Axios, potential Israeli targets may include Iranian oil facilities and other strategic sites.
Israeli airstrikes on October 26 targeted Iranian missile factories, as stated by Israeli military spokesperson Daniel Hagari. The United States has advised Israel against striking nuclear sites or oil fields in Iran, recognizing the significance of Iranian oil, which constitutes approximately 4% of global supply, according to Capital Economics.
Despite US sanctions reinstated in 2018 following withdrawal from the nuclear deal, Iran continues to export oil, primarily to China. In 2023, Iran's oil exports exceeded $35 billion, as reported by Iranian Oil Minister Javad Owji.
From January to May 2024, energy analytics firm Fortesa reported an increase in Iranian oil exports by an average of 1.56 million barrels per day, attributed to enhanced production and demand from China. The Iranian shadow fleet, comprising at least 383 vessels, facilitates these exports by circumventing sanctions.
Iran sells its oil at approximately 20% below global market prices, with Chinese refineries being the primary buyers. Western sanctions also target Iran's international financial transactions, contributing to the Iranian rial's devaluation, which now stands at 580,000 rials per US dollar on the black market.
The inflation rate in Iran is currently around 40%, exacerbating the cost of living crisis. Despite stable oil revenues, Iran's economy remains significantly smaller than Israel's, with a GDP of approximately $403 billion compared to Israel's $509 billion in 2023.
In the UK, the Treasury announced plans to increase business rates on large distribution warehouses utilized by online retailers like Amazon. This measure aims to alleviate tax burdens on traditional high street shops. The new tax will apply to properties valued over £500,000 ($650,000) starting in the 2026-27 fiscal year, as outlined in a policy document released alongside Chancellor Rachel Reeves' budget.