Oil Prices Surge Past $100 a Barrel Amid Ongoing Middle East Tensions

Oil prices have surged past $100 a barrel for the first time since July as tensions in the Middle East continue to escalate. Brent crude, the international standard, jumped nearly 3% to $100.72 early Wednesday, while U.S. benchmark crude gained 2.4% to $95.25 a barrel.

U.S. gasoline prices rose sharply overnight, with the average price for a gallon of regular gasoline ticking up 7 cents to hit $4.22. This is more than a dollar above what it cost at this point last year, according to AAA.

The recent attacks on oil facilities and ships in the Middle East have threatened to debilitate an already weakened supply chain. The U.S. military reported striking five Iranian tankers in response to attempted missile attacks on a Navy warship, while an Iranian-backed Houthi rebel group ignited fires at oil facilities in Saudi Arabia.

Bank of America analysts increased their oil price forecast for the second half of the year to $83 a barrel 'in light of more persistent disruptions to Hormuz'. However, if attacks continue to choke off traffic through the strait, prices could reach $95 to $120 a barrel, while damage to major energy infrastructure could produce spikes of up to $150 a barrel.