The U.S. crude oil benchmark surged nearly 2.5% on Wednesday, with Brent crude close behind, as Wall Street anxiously awaited Iran’s response to Israel’s assassination of a Hamas leader on Iranian soil.
By 1:09 p.m. ET on Wednesday, WTI had risen 2.53% (down from nearly 3.5% gains an hour earlier) to $75.05. Brent crude was up 2.28% at $78.22, still unable to breach the $80 mark. Reports of Israel stockpiling blood supplies and reinforcing their underground bunkers in preparation for a potential Iranian attack have panicked markets, though these preparations have been ongoing since the October 7 Hamas attack on Israel.
Concerns over potential supply disruptions have grown, with military escalations heightening fears that the broader Middle East could be drawn into the conflict, putting energy infrastructure at risk.
Tensions escalated on Wednesday, with Iranian army commander Abdolrahim Mousavi stating, “We believe that this child-killing Israeli regime is nearing its end. History shows that anyone who rules with oppression will not remain in power and will be annihilated ASAP.” OilPrice.com quoted Mousavi promising a “strong and definite response” to Israel and praised Hamas for appointing Yahya Sinwar as its new political head following the assassination of their leader.
Middle East tensions have overshadowed positive inventory reports as the main driver of prices. However, this week’s EIA stockpile report, showing another inventory decline for the week ending August 2, also influenced the market. A day earlier, the American Petroleum Institute (API) had estimated a build in U.S. crude oil inventory, which briefly pressured prices downward until the official EIA report on Wednesday.
