Crude prices surge as Middle East tensions broil.
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Crude prices surged to a two-week high on Wednesday as tensions escalated in the Middle East and Iran called for an oil embargo on Israel.
Brent Crude Oil — a European benchmark used for global market purchases — rose to $91.48 by early Wednesday afternoon, or a 1.76 percent increase over the previous day, according to MarketWatch.
The West Texas Intermediate (WTI) — a futures contract traded on the New York Mercantile Exchange — sat at about $88.29, or a 1.88 percent increase from the day before.
These numbers, according to Reuters, steered Brent and WTI on course for what could be their highest closes since Sept. 29 and Oct. 3, respectively.
The upswing in oil prices marks a stark contrast from the decline we reported a week ago, when Saudi Arabia pledged to help stabilize the market amid the ongoing Israel-Hamas war.
The surge in prices came amid President Biden’s Wednesday visit to Israel, during which he expressed unwavering support for Israel while also advising its leaders to proceed with caution.
The day before, hundreds of people died in a Gaza hospital explosion. Hamas claimed an Israeli airstrike led to the blast, but Israel and the U.S. have attributed it to a misfired rocket from the Islamic Jihad group.
Iranian Foreign Minister Hossein Amir-Abdollahian has called for Islamic nations to boycott and institute an oil embargo on Israel, The New York Times reported, citing Iranian media. Iran is a longtime backer of Hamas.
While Israel imports almost all its oil — mainly from Kazakhstan, Azerbaijan and Nigeria — experts said an embargo would have little immediate effect, as the country does not rely on major Persian Gulf producers, according to the Times.
Nonetheless, such action would be reminiscent of a boycott launched by Organization of the Petroleum Exporting Countries (OPEC) in 1973 during the Arab-Israeli war and that resulted in long lines at U.S. gas pumps, the Times reported.
Υet sources from OPEC, which generates a third of global oil, told Reuters that no immediate action was being taken related to Iran’s demands.
