Oil prices rose on Thursday as investors assessed the potential impact of Republican losses in the US midterm elections on the US-Israeli war against Iran.
Brent futures climbed $2.19, or 2.3%, to $96.81 per barrel by 1255 GMT, while US West Texas Intermediate crude gained $1.32, or 1.5%, to $89.44. Both benchmarks had plunged more than 8% in the previous session, settling at their lowest levels since August 31.
Media quoted analysts as saying that uncertainty over the conflict’s outcome continued to influence oil prices, with markets weighing the prospects of renewed fighting against the possibility of a diplomatic settlement.
Eurasia Group lowered the probability of renewed US strikes on Iran to 60% from 65%, while cutting the likelihood of a deal to 10% from 20%. It raised the chances of a prolonged standoff to 30% from 15%, warning that further escalation could push Brent crude to $110-$125 per barrel.
Meanwhile, Iran’s Islamic Revolutionary Guard Corps said two oil tankers and a tugboat caught fire in separate incidents after attempting to use unauthorised routes through the Strait of Hormuz.
JPMorgan said the recovery of Gulf oil supplies had returned the global market to a surplus of 1.1 million barrels per day in September, rising to 1.4 million barrels per day in October.
However, commercial oil inventories in major consuming countries remain near a 15-year low. US crude, gasoline and distillate stocks also declined last week as oil demand reached its highest level in a year, according to the Energy Information Administration.
Vance urges diplomatic solution to Iran conflict after Republican losses
