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You can measure exactly how worried the oil sector is about more attacks in the Persian Gulf by trading the insurance premiums for oil tankers in the region. War risk premiums for a standard oil cargo from the Persian Gulf and the tanker hauling it can now cost upwards of $500,000, according to Bloomberg. Earlier in 2019 premiums cost less than one-tenth of today’s price.

The scenario that is forcing up those premiums sees actual military action in the Persian Gulf and the critical Strait of Hormuz choke-point as a final endpoint.

But it’s recent steps that convince the tanker companies and insurance markets that the odds that we’ll wind up in some version of the that scenario have climbed.

What are those “recent steps”?

Today, Monday, June 24, President Donald Trump imposed sanctions on Iran’s Supreme Leader, Ayatollah Ali Khamenei, and eight senior military commanders. The sanctions are intended to deny Khamenei and those military leaders access to financial resources. The new sanctions are mostly symbolic since the United States has already put sanctions in place on more than 80% of Iran’s economy. But the move will increase the anger and the desire to strike back among the most hardline parts of Iran’s military and those elite units who answer to the Supreme Leader and not to the country’s elected government.

And today in Tehran the country’s minister for information and communications technology tweeted defiance after U.S. cyberattacks on Iran. “They try hard, but have not carried out a successful attack,” Mohammad Javad Azari Jahromi said. Many cyber-security experts and Iran watchers think the U.S. attack and the Iranian public response raise the odds that Iran, which has a very vigorous global hacking effort, will retaliate in kind with an even bigger attack on U.S. assets. If part of the reason for the shooting down of the U.S. drone with an Iranian missile ws to prove to the United States that Iran could match U.S. technology, the same logic calls for a muscle-flexing cyber attack by Iran.

Both of these announcements keep the crisis on a path of escalation. Which is why the insurance market is so nervous.