Investing.com — Oil prices rose Thursday on concerns that the escalating conflict in the Middle East could disrupt crude flows from this key export region.
At 08:40 ET (1240 GMT), futures were trading 2.2% higher at $71.61 per barrel and the contract rose 1.9% to $75.33 per barrel.
Crude oil rises due to tensions in the Middle East
Crude benchmarks continue to rise as traders await Israel’s response to Iran firing more than 180 missiles into its territory, given the potential for a response to Iran’s oil infrastructure, hitting the stock of a high-ranking OPEC member.
“There have been suggestions that Israel could target Iranian oil facilities, which would have the potential to push oil prices significantly higher depending on the scale of the attack,” ING analysts said in a note.
“Iran exports roughly 1.7 million crude oil per day, so the potential impact is meaningful,” ING added. “However, an attack on oil facilities could upset the US, especially as the election approaches. A more limited response would be to hit launch sites used for the recent missile attack, while there would be significant escalation if Israel decided to target Iranian nuclear facilities.”
OPEC+ keeps production unchanged
Members of the Organization of the Petroleum Exporting Countries and allies, a group commonly known as OPEC+, met on Wednesday and recommended no change in production policy.
The group wants to increase production by 180,000 barrels per day every month from December.
“All that was said about the geopolitical situation and the conflict was the hope of non-escalation,” an OPEC+ source familiar with the discussions said, according to Reuters.
While OPEC has plenty of spare capacity to compensate for the loss of Iranian supplies, much of that capacity is in the Middle East’s Gulf region and is potentially vulnerable if the conflict escalates further, said Giovanni Staunovo, an analyst at UBS.
US crude oil inventories rise – EIA
U.S. crude inventories rose 3.9 million barrels to 417 million barrels in the week ended Sept. 27, the Energy Information Administration said Wednesday, compared with expectations for a decline of 1.3 million barrels.
