Oil Prices Increase as Israel Prepares for Next Move Against Iran

Oil prices increased 2% on Monday following a decline of nearly 8% last week. Brent crude rose above $74 a barrel, while West Texas Intermediate surpassed $70.

The uptick comes as tensions in the Middle East escalated, with Israel planning retaliation against Iran after a missile attack at the start of October. Over the weekend, a Hezbollah drone exploded near Prime Minister Benjamin Netanyahu’s home. The following day, Israel opened a fresh military assault on the group’s strongholds in Lebanon.

In parallel, China, the world’s largest oil importer, cut its benchmark lending rates on Monday as part of measures to revive growth. Speaking in Singapore, Saudi Aramco Chief Executive Officer Amin H. Nasser said he is bullish about the nation’s consumption.

Despite the rise in prices, analysts warn that unless there is a significant escalation in the Middle East, oil markets could face downward pressure due to increasing global supplies.

The International Energy Agency predicts a potential surplus in oil next year as OPEC+ plans to restore some of its shuttered capacity.

For more information, read the full article on Bloomberg.