Oil prices hit 5 wk high as crude tops $92 a barrel amid US-Iran tensions

Global oil prices climbed to a five-week high on Wednesday, with Brent crude briefly crossing the USD 92 per barrel mark, as escalating tensions between the United States and Iran heightened concerns over potential supply disruptions in the Middle East.
According to media reports,Brent crude futures rose 50 cents, or 0.55 per cent, to USD 91.51 a barrel in early trade, while US West Texas Intermediate (WTI) crude futures gained 30 cents, or 0.36 per cent, to USD 84.64 a barrel. During the session, Brent traded at around USD 92.01 per barrel, while WTI hovered near USD 85.21 per barrel.The latest surge in crude prices followed continued military action by the United States against Iran. The US Central Command (CENTCOM) said it had completed its 11th consecutive night of strikes targeting Iran's military operation centres, maritime capabilities, aircraft hangars, drone storage facilities and logistics infrastructure.
According to CENTCOM, the operation concluded on July 21 and was intended to further weaken Iran's ability to threaten commercial shipping through the Strait of Hormuz, one of the world's most critical oil transit routes.Market expert Ajay Bagga said crude prices were being driven higher by growing fears that energy supplies could face further disruption due to the escalating conflict between the US and Iran, coupled with threats of a naval blockade by Yemen's Houthi rebels.Bagga said global oil markets are currently grappling with three major supply risks simultaneously—the possibility of a closure of the Strait of Hormuz, the Houthis' announcement of a maritime blockade in the Red Sea, and the suspension of operations at the Caspian export hub in the Black Sea after tankers were hit during the Russia-Ukraine conflict, affecting the evacuation of nearly 1.6 million barrels per day of Kazakh oil.
Despite Brent crude touching USD 92 per barrel, Bagga said the market still appeared relatively complacent given the scale of the geopolitical risks, with investors hoping that the US-Iran conflict could eventually move towards a temporary truce.He expressed concern, however, that any US strike on Iran's suspected underground nuclear facilities could trigger a broader escalation, making the situation highly volatile and dependent on decisions taken by both Washington and Tehran.

(Business Correspondent)