Oil prices surge amid market anxiety over “Israeli”-Iranian tensions

Oil prices rose at Thursday’s close after a two-day slump, as the market braced for a possible “Israeli” response to an Iranian missile attack.

West Texas Intermediate crude surged more than 3 percent, settling near USD 76 per barrel, while Brent crude traded at USD 79 per barrel.

“Israeli” Defense Minister Yoav Gallant stated that Israel’s response would be “deadly, precise, and unexpected.”

In contrast, Iran warned it was prepared to launch thousands of missiles if necessary in a counter-attack.

Read more: Houthis announce two military operations in Red Sea, Indian Ocean

Rebecca Babin, senior energy trader at CIBC Private Wealth Group, noted, “Oil price volatility could persist into the weekend as the market struggles to price in ongoing geopolitical developments.” She added that traders are cautious, waiting for market moves amid the prevailing uncertainty.

Geopolitical tensions have heightened, leading to increased market volatility and prompting hedge funds to boost their net long positions.

Meanwhile, US President Joe Biden urged “Israel” to refrain from targeting Iran’s oil infrastructure. However, his call with “Israeli” Prime Minister Benjamin Netanyahu showed limited ability to influence the Israeli government’s decisions – according to Hebrew media.

Economic concerns weigh on the market

Alongside geopolitical tensions, economic worries about China continue to loom. The Chinese government did not introduce any new economic stimulus measures this week, leading to a broad sell-off in markets, including oil, on Tuesday.

The Chinese government is expected to hold a new press conference on Saturday to discuss financial policy.

In the US, government data showed crude oil inventories increased by 5.8 million barrels last week, the largest rise since late April, while gasoline stocks declined.