Benzinga - by Piero Cingari, Benzinga Staff Writer.
Oil prices rallied sharply by the end of the session, with Brent futures climbing 1.2% to surpass $90 a barrel, and West Texas Intermediate futures increasing by 1.1% to over $86 a barrel, amid heightened geopolitical tensions in the Middle East.
The United States Oil Fund (NYSE:USO) closed 1.2% higher.
This spike in oil prices follows recent warnings from U.S. intelligence and its allies about potential Iranian strikes on Israeli targets, in retaliation for an Israeli airstrike that targeted an Iranian consulate in Damascus, Syria earlier this week.
Chart: Oil Prices Spiked After News Of Potential Iran’s Attacks On Israel
Escalating Conflict According to Bloomberg, the U.S. and its allies warn that Iran or its proxies could soon launch major missile or drone attacks on Israeli military and government sites, as a retaliation for an Israeli airstrike on an Iranian consulate in Damascus, Syria.
Israel has reportedly informed its Western allies that while government and military sites might be targeted, civilian facilities are not expected to be hit. In response to these threats, Israel is contemplating another ground offensive against Hamas in Gaza, particularly in Rafah, though the timing remains uncertain.
Ayatollah Ali Khamenei vowed Wednesday retaliation against Israel for its actions in Damascus.
Israeli Foreign Minister Israel Katz warned that if Iran were to launch attacks from its territory, Israel would strike back and heighten the risk of a further escalation of hostilities.
The war in Gaza, now in its sixth month, saw on Wednesday Israeli airstrikes resulting in the deaths of three sons of Hamas leader Ismail Haniyeh, along with four of his grandchildren. The Israeli military has confirmed these strikes, labeling the targets as operatives in Hamas’s armed wing.
Diplomatic and Corporate Reactions In anticipation of further unrest, foreign diplomatic missions in Israel are making emergency preparations, including plans for possible evacuations.
Reuters highlighted that Deutsche Lufthansa AG (OTCPK: DLAKY) has temporarily suspended flights to and from Tehran, citing the volatile situation in the Middle East.
Meanwhile, ceasefire efforts continue, as U.S. President Joe Biden has put forward a proposal for a six-week truce with Hamas, which would include the release of some hostages.
President Joe Biden emphasized the urgency of this proposal, indicating that the resolution of the hostage situation hinges on Hamas’s response.
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