Oil prices surged on Thursday amid growing concerns over a potential escalation in the Middle East conflict. Reports suggest the U.S. and Israel are planning renewed strikes against Iran following next month's midterm elections. Brent crude futures climbed 1.71% to $110.67 a barrel, while U.S. West Texas Intermediate crude rose 1.42% to $98.53.
The New York Times cited unnamed U.S. officials, stating that military plans for a 'short but intensive' operation against Iran are underway. Additionally, the U.S. has ordered non-emergency government employees and their families to leave Saudi Arabia due to increasing attacks by Iran-aligned Houthis on civilian targets.
Despite the rise in oil prices, analysts suggest the economic impact may be less severe than in past decades. David Wagner, head of equity at Aptus Capital Advisors, noted that households are now less vulnerable to energy shocks. He pointed out that gasoline expenses have decreased from roughly 5% of disposable income a decade ago to about half that today.
Wagner emphasized that current oil prices, even at $100 a barrel, are significantly lower than inflation-adjusted historical highs. He expressed optimism that consumers may be better positioned to handle elevated energy costs compared to previous generations.