Oil prices rose to a one-month high on Thursday as traders speculated that Israel could carry out retaliatory attacks against Iran’s oil industry.
Brent crude rose more than 5%, per barrel, after US President Joe Biden told reporters that such measures were being considered in response to Iran’s missile attack on Israel on Tuesday. It settled at $77.62. The gains continued on Friday, with Brent up 1.6% to $78.85.
Asked if the United States would support Israel’s attack on Iranian oil facilities, Biden said, “We’re talking about that,” but the president added in terse comments: “We’re talking about that.” . . Anyway. ”
U.S. officials have held a series of meetings with Israeli officials in recent days as the United States and its Western allies seek to limit the scope of Israel’s response and prevent a broader regional conflict.
U.S. officials believe Israeli retaliation will be sufficient to avoid triggering a new escalation across the Middle East.
One U.S. official said Israeli officials want to send a strong signal to Iran while hoping to de-escalate the conflict. US officials warned that no final decision had been made by Israel.
Biden and Western allies have publicly stated that they oppose any attack on Iran’s nuclear facilities, creating cautious confidence that Israel will soften its response.
G7 leaders called on Israel and Iran in a joint statement Thursday to avoid “uncontrollable escalation” in the Middle East.
“A dangerous cycle of attacks and retaliation risks accelerating uncontrollable escalation in the Middle East, which is in no one’s interest,” they said.
“We call on all regional actors to act responsibly and with restraint. We encourage all parties to work constructively to de-escalate current tensions,” the leaders said. added.
U.S. and Israeli officials have discussed the possibility of Israel attacking military targets and energy infrastructure. U.S. officials said Washington had no plans to participate in the airstrike.
At the same time, there are growing concerns among U.S. allies that the United States is struggling to influence the Israeli government led by Prime Minister Benjamin Netanyahu.
A European diplomat said Israel was being asked to halt attacks on Iran’s oil and nuclear infrastructure, but there was no guarantee Israel would meet the demands.
A second senior EU diplomat said: . . It injects a certain pessimism and a certain fatalism into our discussions about it. ”
Biden denied on Thursday that the United States has a veto over Israeli actions, but added on Thursday that no immediate Israeli response was expected. “We do not ‘allow’ Israel. We advise Israel and nothing will happen today,” the US president said.
Biden’s comments came amid concerns about the war escalating. Israel launched a ground invasion of Lebanon on Tuesday after weeks of heavy bombing, while continuing its nearly year-long war in Gaza.
Israel has vowed to respond after Iran fired nearly 200 ballistic missiles at Israel on Tuesday night in retaliation for the Iranian-backed attack on Hezbollah and the killing of its leader Hassan Nasrallah.
On Thursday, Israel launched multiple airstrikes in Beirut, killing at least nine people at a Hezbollah-linked medical facility in the center of the Lebanese capital and also targeting a building used by the extremist group’s media office.
The United States’ stated goal for months has been to broker a ceasefire between Israel and Hamas to end the war in Gaza, and has recently also pushed for a ceasefire between Israel and Lebanon. However, both efforts ended in failure.
This week, U.S. Deputy Secretary of State Kurt Campbell acknowledged that there have been “remarkable moments” in the U.S.-Israel relationship in recent months. But speaking at a virtual event hosted by the Carnegie Endowment for International Peace, he acknowledged the “huge efforts on both sides to keep the lines of communication open and ensure that perspectives are understood.”
West Texas Intermediate, the U.S. oil benchmark, also soared after Biden’s comments, settling 5.2% higher at $73.71 on Thursday. It rose to $74.84 on Friday.
According to consultancy Energy Aspects, Iran exports about 1.6 million to 1.8 million barrels of crude oil and condensate per day, of which 1.5 million barrels per day goes to China, and more than 0.5 million barrels per day of petroleum products. is exported.
Amrita Sen, director of research at Energy Aspects, said oil prices would “skyrocket” if Israel attacked an Iranian refinery and Iran responded by attacking other oil fields and refineries in the region. He said it was possible.
Global oil markets have remained volatile since the beginning of the week due to rising tensions, which could disrupt energy exports.
However, the market was weighed down by a lack of demand from China and OPEC+ producers, which have more than 5 million barrels a day of spare capacity that could be used if supplies from Iran were reduced.
Additional reporting by Leif Uddin and Shotaro Tani in London and Miles McCormick in Houston
Satellite visualization by Hirofumi Yamamoto and Stephen Barnard
