Oil has hit its highest level in more than six months as fears of fresh escalation in the Middle East conflict grip the energy markets.
Brent crude, the international benchmark for oil, rose by about ۳.۵% on Friday to pass $۱۱۷ a barrel at one point – its highest level since April.
The jump came after Tehran said it would attack oil facilities, undersea cables, datacentres and AI facilities in the Gulf region if a new US-Israeli offensive was launched against Iran.
Richard Hunter, of the broker Interactive Investor, said: “Widespread reports that the US is considering renewed military strikes on Iran after the midterm elections rather than pursuing a diplomatic route was enough for the price to pop, after what many had considered would be a brief conflict is now in its eighth month.”
The oil price later eased back slight to sit about ۲.۷% up at just over $۱۱۶ a barrel. Brent crude had traded at about $۷۲ a barrel back in February, before the Iran war began, but soared to touch $۱۲۶ a barrel by the end of April.
Tensions in the region have been rising this week and Iran’s Islamic Revolutionary Guards Corps claimed to have struck four commercial ships in the strait of Hormuz on Wednesday. The US state department ordered some diplomats and the families of US government employees to leave Saudi Arabia, which has faced continued attacks from Houthi rebels in Yemen.
Susannah Streeter, the chief investment strategist at the broker Wealth Club, said fears were rising that American and Israeli forces would be ordered to launch strikes on Iran’s energy infrastructure after the US elections on ۳ November.
She added: “At the same time, the attacks on Saudi Arabia’s facilities by Houthi rebels have intensified this week, and for ships attempting to cross the strait of Hormuz, it’s still a dangerous journey, with projectiles still being fired.”
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Streeter said Ukraine’s bombardment of Russian diesel refineries was also adding to supply concerns.
