Oil Prices Surge Over 3% After Iran Targets US Airbase

Oil prices increased by over 3% on Thursday after the Iranian Revolutionary Guard announced it had targeted a US airbase, according to Reuters.

Brent crude futures climbed by $3.51, or 3.72%, reaching $97.8 per barrel. The most active August contract rose by $3.35, or 3.63%, to $95.6 per barrel, with the July contract set to expire on Friday.

Meanwhile, US West Texas Intermediate crude futures increased by $3.31, or 3.73%, to $91.99 per barrel. Both benchmarks had fallen by more than 5% to their lowest levels in a month during the previous session, amid speculation of a potential US-Iran agreement to end hostilities and reopen the Strait of Hormuz.

A US official told Reuters that the US military launched new strikes in Iran targeting a military site that officials concluded posed a threat to US forces and commercial maritime traffic in the strait.

Daniel Hines, a commodities analyst at ANZ, noted in a memo that oil supplies remain limited and key points of disagreement have yet to be resolved.

In the United States, data from the American Petroleum Institute showed crude oil inventories dropped by 2.8 million barrels last week, marking a sixth consecutive weekly decline.

The official inventory data from the US Energy Information Administration is scheduled for release on Thursday, a day later than usual due to the Monday holiday.

In a related development, Kuwait announced that its air defenses intercepted hostile missile and drone attacks. The Kuwaiti General Staff stated that any explosion sounds heard are the result of air defense systems intercepting the attacks.