US crude oil surged past $100 a barrel on Thursday as fighting between Washington and Tehran sharply escalated. White House advisers have discussed the possibility that the war could drag on past January 2029, contradicting President Donald Trump's claim that it would end right after the midterm elections.
WTI tops $100, Brent climbs above $104
West Texas Intermediate futures hit a session high of $100.88 per barrel on Thursday, the highest level in more than three months. US crude was last up 3.4% to $99.27. Brent crude, the international benchmark, traded 3.3% higher to $104.57 a barrel.
According to David Morrison, senior market analyst at Trade Nation: "WTI has completely unwound its selloff between early June and July", with Brent prices now well above where they stood in early June.
War risks stretching past 2029
Top White House advisers have discussed with Trump the possibility that the Iran war could drag on past Inauguration Day in January 2029, officials told The Wall Street Journal. The report contradicts Trump's claim on Wednesday that the war would end immediately after the midterm elections, after he asserted for months that the conflict was drawing to a close.
Trump told reporters Wednesday that oil and gasoline prices would fall after the midterms. Yet pump prices hit a Labor Day record on Monday, and diesel is expected to cross $6 a gallon for the first time ever in the coming days.
Fighting broadens across the region
Fighting between Washington and Tehran erupted this month after a period of relative calm in August. Iran has tried to attack American warships several times, while the US military has destroyed at least eight Iranian tankers since Saturday in retaliation.
Iran's Houthi allies in Yemen also attacked several energy facilities and other targets in Saudi Arabia this week, injuring more than 70 civilians and raising concerns that the war was broadening. As a result, the escalation is raising the risk of oil prices surging above $120 a barrel as attacks on shipping intensify, according to Daan Struyven, co-head of global commodities research at Goldman Sachs.
The physical market may tighten further if transit volumes keep declining or energy infrastructure comes under threat, extending the upward move in oil prices, said Andrei Constantin, commercial director and trading adviser at TFP Software FZCO.
Source: CNBC
Trading involves risk.
Risk Disclaimer
