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An oil shock may be enough to push the global economy into recession

3 0 0
18.09.2019

The US has now categorically accused Iran of staging a swarm attack of 20 drones and a dozen missiles on the Saudi separation plant at Abqaiq, the biggest oil operation in the world. The Saudis have in turn stated the weapons used were Iranian. They deny the assault was an autonomous action by the Shia-aligned Houthis in Yemen, Iranian military proxies in any case. The Middle East is therefore on a war footing.

The long-festering contest for Gulf dominance between the Shia and Sunni regional powers is coming to a head.Credit:AP

This is not a "black swan" event. It became predictable after US President Donald Trump chose to tear up the nuclear accord with Iran, shut down 2 million barrels a day of Iranian oil exports and throw US strategic might behind Saudi Crown Prince Mohammed bin Salman.

It is more like a Middle East "Sarajevo" moment. The long-festering contest for Gulf dominance between the Shia and Sunni regional powers is coming........

© The Age