Oil prices rise as Iran-Israel conflict escalates
Oil prices rose on Tuesday on rising disruptions from the Iran-Israel conflict, although major oil and gas infrastructure and flows have so far been spared from any substantial impact.
Brent crude futures climbed $1.23, or 1.7%, to $74.46 a barrel as of 1023 GMT. U.S. West Texas Intermediate crude was up $1.08, or 1.5%, at $72.85.
Both contracts rose more than 2% earlier in the trading session but also notched declines before bouncing back in volatile trading.
While no visible interruption was noticed in oil flows, Iran partially suspended gas production at the South Pars gas field that it shares with Qatar, after an Israeli strike caused a fire there on Saturday. Israel also hit the Shahran oil depot in Iran.
"The market is largely worried about disruption through (the Strait of) Hormuz but the risk of that is very low," said Saxo Bank analyst Ole Hansen.
There is no appetite around closing the waterway since Iran would lose revenue and the U.S. wants lower oil prices and wants to lower inflation, Hansen said.
Two oil tankers collided and caught fire on Tuesday near the Strait of Hormuz, where electronic interference has surged, highlighting the risks to companies moving oil and fuel supplies in the region.
Despite the potential for disruptions, there are signs oil supplies remain ample amid expectations of lower demand.
In its monthly oil report released on Tuesday, the International Energy Agency revised its world oil demand estimate downwards by 20,000 bpd from last month's forecast, and increased the supply estimate by 200,000 bpd to 1.8 million bpd.
Investors were also focused on central bank interest rate decisions, Tamas Varga, analyst at PVM Associates said in a note, with the U.S. Federal Open Market Committee, which guides the Federal Reserve's rate movements, set to meet later on Tuesday.
(Reporting by Seher Dareen in London, Anjana Anil in Bengaluru and Jeslyn Lerh in Singapore; Editing by Christopher Cushing, Christian Schmollinger, Sonali Paul and Rachna Uppal)
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Khaleej Times
2 hours ago
- Khaleej Times
Dubai: 18 Filipinos stranded at DXB repatriated home amid Israel-Iran conflict
The Philippine government has successfully repatriated 18 overseas Filipino workers (OFWs) who were stranded at Dubai International Airport. They arrived on June 13 and were supposed to be on their way to work in Israel and Jordan but were stranded in Dubai due to the temporary shutdown of major airports amid the ongoing conflict between Iran and Israel. Philippine labour attache John Rio Aceveda Bautista told Khaleej Times on Tuesday the OFWs arrived on Friday and were repatriated on June 15. Fifteen of the repatriated OFWs were returning workers to Israel, while three were newly hired workers bound to Jordan. After arriving in Manila on Monday, they were temporarily housed at a hotel, according to the Philippine Department of Migrant Workers (DMW). DMW secretary Hans Leo Cacdac said each OFW received Ph50,000 (Dh3,335) in financial assistance. 'This is not simply aid but a safety net as they have temporarily lost their source of income,' said Cacdac, adding the OFWs will also receive transportation allowance back to their respective home provinces. Meanwhile, Eduardo de Vega, undersecretary of the Philippine Department of Foreign Affairs (DFA) said the security threat in Israel is classified by the Philippine government as under alert level 2, meaning there are heightened risks to safety and security. 'Mandatory repatriation is based on alert levels,' Cacdac noted. 'We are still coordinating with the DFA and DND (Department of National Defence) on this. But rest assured, we are ready if the situation worsens.' Cacdac said there are about 30,000 OFWs – mostly employed in caregiving, agriculture, hospitality, and manufacturing – in Israel. 'It it is difficult to determine how many are in immediate danger without causing unnecessary alarm,' he added. There are approximately more than 1,000 Filipinos in Iran. DFA said there are contingency plans for a possible evacuation route through Turkmenistan. Philippine officials reminded OFWs to monitor official channels for updates and to follow local advisories. After Israel launched strikes on Iran in Friday, several countries, including Iraq, Jordan, Lebanon and Israel have closed their airspaces for commercial flights. UAE-based airlines immediately announced that customers connecting through UAE with final destinations in Iraq, Iran, Jordan, Lebanon would not be accepted for travel at their point of origin until further notice.
Zawya
3 hours ago
- Zawya
Israel war risk ship insurance costs soar after Iranian attacks, sources say
War risk insurance premiums for shipments to Israel are as much as three time higher than a week ago as the war between Israel and Iran entered its fifth day, industry sources said on Tuesday. The cost of a seven-day voyage to Israeli ports was quoted between 0.7% to 1.0% of the value of a ship versus around 0.2% a week ago, they said. Individual underwriters will price risk differently, but this will add tens of thousands of dollars per day for every voyage. (Reporting by Jonathan Saul; Editing by Emelia Sithole-Matarise)
The National
3 hours ago
- The National
Rising Middle East tension reminder that energy a 'cornerstone of peace', Dr Sultan Al Jaber says
Rising tension in the Middle East is a reminder that energy is a 'cornerstone of peace, stability and ensuring prosperity', Dr Sultan Al Jaber, Minister of Industry and Advanced Technology and Adnoc's managing director and group chief executive, said on Tuesday. The war between Israel and Iran has sparked fears of a potential supply crisis in energy markets, with Brent oil prices rising above $75 a barrel on Tuesday. 'The UAE stands for dialogue, de-escalation and diplomacy,' Dr Al Jaber said during a keynote address at the Atlantic Council Global Energy Forum in Washington. Dr Al Jaber said countries must also remain focused on opportunities – chiefly the burgeoning artificial intelligence sector – as partners remain committed to dialogue and diplomacy. US Energy Secretary Chris Wright, who was scheduled to speak at Tuesday's forum, had cancelled his appearance to assist President Donald Trump as the crisis worsens, the Atlantic Council's president said before Dr Al Jaber's remarks. 'Once-in-a-generation' investment opportunity AI is "driving the next stage of evolution" and the advanced technology is driven by energy, he said. AI requires significant energy to be powered through data centres. The US will require between 50 and 150 gigawatts of new installed capacity and this demand brings a 'once-in-a-generation investment opportunity', Dr Al Jaber added. Mr Al Jaber also said the UAE is 'wasting no time in taking our powerhouse energy partnership with the US to the next level'. 'The United States is not just a priority. It is more of an investment imperative. This is not just capital, it's conviction and a shared future, partners, colleagues and friends'. The UAE has announced a number of planned investments in the US since Mr Trump began his second term in January. Chief among those was a $1.4 trillion investment framework announced by the White House in March. During Mr Trump's visit to the UAE in May, Dr Al Jaber announced the UAE intends to boost its investment in the US energy sector to $440 billion by 2035 as part of that framework. The UAE will increase its US energy investments six-fold over the next decade through XRG, he said. XRG, Adnoc's global energy investment arm, signed an agreement with Occidental and subsidiary 1PointFive last month on a potential investment for a direct air capture project in Texas. XRG could invest up to $500 million in the project. US companies are also expected to invest up to $60 billion in UAE energy projects, including a field development plan with ExxonMobil and Japanese companies Inpex and Japan Oil Development Company to expand the capacity of Abu Dhabi's Upper Zakum offshore field. Separately, Adnoc and Occidental agreed on a collaboration to potentially increase Shah Gas's production capacity from 1.45 billion to 1.85 billion standard cubic feet per day. Also in March, Abu Dhabi's sovereign wealth fund ADQ announced plans to invest more than $25 billion in mostly US-based energy projects to power data centres with US private equity firm Energy Capital Partners.
