Oil Prices Rise as Markets Eye Inflation Report and ECB Rate Hike

Oil prices rose again after fresh US-Iran friction in the Gulf, just as investors size up this week's US inflation report and an expected European Central Bank rate hike to 2.5%.

Brent crude climbed 0.7% to $96.97 a barrel, following an almost 8% jump last week.

The increase in oil prices is not just about higher gas at the pump; it can also lift diesel costs, which ripple through many other prices due to its use as a backbone input for trucking, shipping, farming, and factories.

This comes ahead of Friday's US August consumer price index (CPI) report, where economists expect 'core' inflation (stripping out food and energy) to rise 0.2%, but traders are watching whether the number prints closer to 0.3%.