Crude Oil: Prices Climb as Traders Weigh Possible Middle East Escalation

Deep News
1 hour ago

Oil prices pushed back above $100 a barrel as investors weighed the possibility that the United States and Iran could return to intense conflict, which could tighten crude and refined product supplies further.

Brent for December delivery rose 4.4% to settle above $102 a barrel. Crude futures reached their intraday high on Thursday after reports said the United States had dispatched a third carrier strike group to the Middle East.

Wall Street analysts and traders said earlier this week that Middle East crude export volumes were close to pre-war levels. But Iran appeared not to have loaded any crude onto tankers in September, the latest sign that the U.S. maritime blockade is effectively cutting Iran off from energy markets. Investors worry that an increasingly cornered Iran could respond by escalating the conflict.

Hamad Hussain, climate and commodities economist at Capital Economics, said: "The increase in oil flows remains highly vulnerable to escalation. Given that inventories are relatively low after roughly six months of continuous declines, I think the market remains structurally tight."

Traders are also grappling with uncertainty in the refined products market. Middle East turmoil and Ukrainian attacks on Russian refineries have disrupted the diesel market. Citing people familiar with the matter, reports said the United States has told Germany and France to release emergency diesel reserves to help ease global fuel prices or potentially face a U.S. diesel export ban.

Brent for December delivery rose 4.4% to settle at $102.31 a barrel; West Texas Intermediate for November delivery rose 2.7% to settle at $92.87 a barrel.

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