Oil prices surged 3% on Thursday as concerns over a potential US attack on Iran raised fears that global supplies could be disrupted, pushing Brent futures to a five-month high and WTI to its highest close since September 26. The US President Donald Trump is weighing options against Iran, including targeted strikes on security forces and leaders, amid a nationwide protest movement that has killed thousands of people.
Iranian crude production would account for about 20% of the world's total supply if it were to be cut off, according to EIA data. European Union foreign ministers adopted new sanctions on Iran targeting individuals and entities involved in a violent crackdown on protesters.
The Kremlin said Russia had reiterated its invitation for Ukrainian President Volodymyr Zelenskiy to come to Moscow for peace talks as US-led efforts to reach a deal to end the nearly four-year war in Ukraine intensify. Kazakhstan announced that Chevron would take measures to ensure the reliable and safe operation of facilities at its giant Tengiz oilfield, with the aim of reaching full production in a week.
The dollar held near its lowest against a basket of other currencies since February 2022 on uncertainty over US economic policies, which could boost oil prices by making dollar-priced oil less expensive for many global buyers. Analysts noted that when Brent's premium over WTI rises over $4 a barrel, it generally makes economic sense for energy firms to send ships across the ocean to pick up US crude, which should result in higher US exports.
The surge in oil prices is largely driven by concerns about potential disruptions to global supplies due to tensions with Iran. As a result, investors are taking a cautious stance and adjusting their expectations for future price movements.
