Persian Gulf has become a tinderbox in wake of Shia cleric's execution
The Persian Gulf has become a strategic tinderbox. Saudi Arabia's drastic decision to behead the Shia cleric Nimr al-Nimr marks a point of no return in the bitter Sunni-Shia conflict engulfing the region. It is a dangerous escalation in the Kingdom's struggle with Iran for regional hegemony.
Iran's Revolutionary Guard has vowed swift and harsh revenge, promising to bring down the Saudi dynasty in short order to avenge this "medieval act of savagery".
Brent crude jumped to a three-week high of $38.91 (¤36) a barrel as traders began to price in the first flickers of political risk. Roughly a fifth of global oil supply passes through the Strait of Hormuz, where tankers would in extremis have to run the gauntlet past Iranian warships.