Brent crude topped $112 a barrel on Thursday after reports that the U.S. and Israel are drawing up plans for renewed strikes on Iran. The U.S. also ordered some government staff to leave Saudi Arabia. One fund manager argued the economic hit from $100 oil may be milder than in past decades.
Oil prices climbed Thursday on worries over a possible escalation in the Middle East conflict, as the U.S. reportedly plans to resume strikes against Iran.
Brent crude futures rose 3.1% to $112.20 a barrel as of 4:12 a.m. ET. U.S. West Texas Intermediate crude gained 2.79% to $99.86.
The New York Times reported, citing unnamed U.S. officials, that the U.S. and Israeli militaries have drawn up specific plans for renewed strikes on Iran after next month's midterm elections. The Times said planning for a short but intensive operation is progressing.
Meanwhile, the U.S. ordered non-emergency government employees and their families to leave Saudi Arabia. State Department spokesman Tommy Pigott said in a post on X that the order applies only to Saudi Arabia, citing increasing attacks by Iran-aligned Houthis on civilian targets.
However, the economic fallout from elevated oil prices may be less severe than in previous decades, according to David Wagner, head of equity and portfolio manager at Aptus Capital Advisors. He noted that crude prices remain well below their inflation-adjusted historical highs.
Wagner pointed to U.S. government data showing that gasoline accounted for roughly 5% of the average American's disposable income a decade ago, compared with about half that today. Wagner said: "we can hold that umbrella over our head" from the rainstorm of oil.
Source: CNBC
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