Oil prices rose nearly 1% in early Asian trade on Wednesday as renewed US-Iran strikes intensified concerns over supply disruptions and further clouded hopes of a quick easing in Middle East tensions.
Brent crude futures climbed 87 cents, or 0.92%, to US$95.52 a barrel by 0008 GMT, while US West Texas Intermediate (WTI) crude futures rose 80 cents, or 0.89%, to US$91.02.
Both benchmarks jumped more than US$4 on Tuesday, with Brent recording its biggest daily gain since July 24 and WTI posting its strongest increase since July 23.
The latest gains followed a fresh escalation between the US and Iran, with Washington saying it launched a series of airstrikes against targets in Iran overnight. Iran subsequently retaliated, marking the most serious escalation between the two sides in weeks.
US Central Command said the strikes followed attempted attacks by Iran’s Islamic Revolutionary Guard Corps (IRGC) against commercial shipping in the Strait of Hormuz and US service members stationed in the region.
The IRGC warned that the US strikes would further restrict traffic through the Strait of Hormuz, a key shipping route that handled around one-fifth of global oil consumption before the conflict and has effectively been closed to commercial shipping by Iran.
Iran also claimed to have targeted a US military base in Jordan with ballistic missiles, while Iranian state media reported a large-scale drone attack against a US base in Bahrain.
Jordan’s military said its air defences intercepted 10 of 13 ballistic missiles that entered its airspace. Two US officials said there had been no reported American casualties from the attacks, while Kuwait said its armed forces were responding to hostile drone activity.
The latest exchange follows a weekend flare-up in hostilities, the first since July, and comes after attacks on two tankers departing the Strait of Hormuz on Monday. The incidents have further disrupted oil flows and forced traders to look for alternative crude supplies.
Supply concerns were also reinforced by US inventory data. Crude inventories in the world’s largest oil-producing country fell by 2.6 million barrels in the week ended August 28, while distillate stocks, including diesel and heating oil, declined by 265,000 barrels, according to market sources citing American Petroleum Institute data.
Reuters
