Middle East Conflict Drives Oil Prices Higher Amid Prolonged Supply Disruptions
Oil prices surged on Thursday due to concerns that the ongoing conflict in the Middle East could lead to prolonged supply disruptions. Brent crude futures for October delivery jumped $2.51, or 2.7%, to $94.10 a barrel at 12:20 GMT, while US West Texas Intermediate (WTI) crude futures for September delivery climbed $2.66, or 3.1%, to $88.49 a barrel.
The increase marked the fifth consecutive session of gains for both Brent and WTI, with their prices reaching their highest levels since July 24. The US Energy Information Administration (EIA) reported that US crude inventories unexpectedly increased by 4.4 million barrels last week, but distillate inventories fell for a third consecutive week.
The tensions in the Middle East persist, with the United Arab Emirates suspending all financial and economic transactions with Iran until further notice. US President Donald Trump warned on Wednesday of economic consequences for any country providing 'any kind of lifeline to Iran.' The Strait of Hormuz remains closed, affecting refined fuel supplies and contributing to declining inventories.