Middle East Strikes Send Oil Prices Soaring to Near-$100
Oil prices surged to nearly $100 per barrel on Wednesday after fresh Middle East strikes heightened supply risks. The Brent crude futures rose 1.4% to $99.33 a barrel, while US West Texas Intermediate crude was at $94.34 a barrel, up 1.4%. This is the fourth consecutive day of price gains, with Brent crude prices jumping by a quarter since early August.
The renewed attacks across the Middle East intensified on Tuesday, with Iranian-backed Houthis in Yemen launching strikes on several Saudi cities. The US forces also hit multiple Iranian oil tankers, and Iran targeted a US base in Jordan. Analysts said that the market is likely to continue pricing in a sizeable risk premium due to ongoing conflicts.
ING analysts noted that recent developments reinforce the view that peace talks are unlikely to restart soon. Meanwhile, the latest attacks threaten to deepen disruptions to Middle East oil supplies, which are already strained by strikes on regional energy infrastructure and key shipping lanes.