Oil Markets Weigh Prospect of a Full-Scale Iran-Israel War

Despite sanctions, Iran is still a big oil producer, with huge refining capacity. It also controls waterways crucial to the flow of Gulf oil. Yet the West has reserves and China’s demand is dropping. Since Iran and Israel began trading military blows directly earlier this year, analysts have been trying to understand what impact any war between these two regional foes would have on oil prices and supply. So far, Israeli air strikes against Iranian sites have only hit military facilities, not Iran’s nuclear or oil infrastructure, but were Israel to change its targeting, it could bomb oil storage facilities,…