Μake us preferred on Google Oil prices surged by around $3 a barrel on Wednesday following U.S. and Saudi strikes on Iran-backed targets in Iraq, the interception of Iranian ballistic missiles aimed at U.S. forces in the Middle East, and a decline in U.S. crude inventories.
Brent crude futures rose $3.30, or 3.9%, to $87.39 a barrel at 0300 GMT, while U.S. West Texas Intermediate crude gained $3.05, or 3.8%, to $82.31 a barrel.
“The renewed momentum comes after the U.S. announced that it had repelled a surprise attack on American troops,” ING analysts said in a note, according to Reuters, adding that the latest developments have dampened expectations of a swift de-escalation of tensions in the Persian Gulf.
Middle East tensions flare up
Iran’s Revolutionary Guards leadership later said it had launched several ballistic missiles at a U.S. air base and facilities linked to U.S. Central Command in Jordan.
Saudi Arabia also said its armed forces, in coordination with U.S. Central Command, had carried out “targeted strikes” against Iran-backed groups in Iraq, accusing them of drone attacks on the kingdom’s oil facilities.
U.S. crude inventories fall
U.S. crude oil inventories fell by around 3.3 million barrels in the week ending July 24, market sources said on Tuesday, citing data from the American Petroleum Institute.
Official inventory figures from the U.S. Energy Information Administration are due later on Wednesday.
OPEC+ may pause output increases
Further supporting oil prices, OPEC+ is likely to suspend planned production increases for three months starting in October, according to sources cited by Reuters. The move would come after the producer group completes its scheduled return of barrels that had been removed from the market through voluntary cuts.
