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Risk of oil supply disruptions can have an immediate effect on oil prices
Crude oil supply disruptions—realized or expected—can have large and immediate effects on crude oil prices. Two recent events, the September 2019 attacks on Saudi Aramco facilities at Abqaiq and Khurais (which disrupted crude oil volumes) and the January 2020 military operations in Iraq (which did not disrupt crude oil volumes), led to relatively large daily price changes and intraday price movements—movements within single trading days. Intraday prices of front-month Brent crude oil futures for the two events followed a broadly similar path at first: an upward movement as market participants reacted to the news and a downward movement as new information was incorporated.

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