Crude oil prices jump 4% as Israel strikes on Iran
Crude oil prices experienced a significant surge of over 4% on Friday, largely attributed to escalating tensions in the Middle East, particularly between Iran and Israel. Brent oil, a global benchmark for oil prices, rose to $90.54 per barrel, marking a 3.94% increase. US West Texas Intermediate (WTI) crude futures also witnessed an uptick of 4.06%, reaching $86.09 per barrel.
Israeli missile strikes spark oil price hike
The sudden hike in oil prices was triggered by reports of Israeli missile strikes on an Iranian site, causing explosions at an airport in Isfahan, Iran. Isfahan houses the Iranian military's primary airbase and several sites linked to the nation's nuclear program. Today's missile launches follow an offensive by Iran on targets surrounding Israel last Saturday. During the attack, Iran unleashed a barrage of more than 300 unmanned drones and missiles but almost 99% of them were intercepted.
Middle East is crucial player in global crude oil production
The Middle East is a pivotal global crude oil producer, accounting for over 30% of worldwide production. Saudi Arabia, the world's second-largest oil producer and the largest in the region, contributes over 12% of global crude output. Iran also holds a significant role in regional production with a global share of 3.3%, making any conflict in this area potentially impactful on crude oil prices.
Rising tensions could push crude oil prices to $100
So far, both Brent and WTI futures have remained stable without significant fluctuations in recent trading sessions. However, industry experts warn that if tensions continue to escalate, crude oil prices could potentially surge to $100 per barrel. Iran's crude production has increased by more than 20% over the past two years to 3.4 million barrels per day. The escalating Middle East tensions, along with OPEC supply cuts tightening the market, have fueled a surge in crude oil prices this year.
