Singapore: Global oil prices were higher in early trading on Wednesday as investors reacted to renewed military escalation between the United States and Iran, raising concerns over potential disruptions to crude supplies from the Middle East.
Brent crude climbed 1.1% to $92.01 a barrel, while US West Texas Intermediate (WTI) gained 1.0% to $85.16 a barrel in early trading, extending gains after both benchmarks closed at their highest levels in five weeks.
Oil markets remained under pressure after the United States carried out its 11th consecutive night of strikes on Iranian military targets. The latest operation came after Iran launched attacks on US-linked facilities in Bahrain, Kuwait and Jordan, while Kuwait said its air defence systems intercepted Iranian drones.
Analysts said the continued exchange of attacks has heightened fears that the conflict could affect oil production and exports across the region.
Concerns also increased over the security of major energy shipping lanes.
Read More: Oil risks keep global markets cautious
Yemen’s Iran-backed Houthi movement announced a naval blockade against Saudi Arabia and threatened to target vessels transporting Saudi crude through the Bab el-Mandeb Strait, a key route connecting the Red Sea to global markets.
According to reports, three Saudi oil tankers heading to China and India changed course in the Red Sea after the warnings, opting to travel through the Suez Canal instead.
Market analysts said any disruption to shipping routes could increase transportation costs and delay oil deliveries.
Supply concerns also spread beyond the Gulf after the Caspian Pipeline Consortium suspended oil loadings from Kazakhstan following attacks on tankers at its Black Sea terminal.
Separately, US Defense Secretary Pete Hegseth said Washington’s military operations against Iran have cost $37.5 billion, nearly $8 billion more than previous estimates.
Meanwhile, data from the American Petroleum Institute (API) showed US crude and distillate inventories increased last week, while gasoline stockpiles declined. Investors are now awaiting official inventory data from the US Energy Information Administration (EIA) later on Wednesday.
Analysts said oil prices are expected to remain volatile as markets closely monitor developments in the Middle East, with any further escalation likely to add fresh pressure on global energy supplies and crude prices.
