Oil rises 3% after Iran strikes Middle East energy facilities
Oil prices are likely to remain supported as Iran's fresh strikes on Middle Eastern energy infrastructure deepen regional tensions, says a market strategist.
Oil prices rose as much as 3% on Thursday (19 March) after Iran attacked several energy facilities across the Middle East following a strike on its South Pars gas field, a major escalation in Tehran's war with the US and Israel.
Brent futures were up $3.69, or 3.44%, to $111.07 by 0142 GMT, while US West Texas Intermediate crude rose $2.29, or 2.38%, to $98.61.
Brent closed up 3.8% on Wednesday, while WTI settled nearly flat. WTI has been trading at its widest discount to Brent in 11 years due to releases from US strategic reserves and higher freight costs, while renewed attacks on Middle Eastern energy facilities have given greater support to Brent.
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QatarEnergy said on Wednesday that Iranian missile attacks on Ras Laffan, the site of Qatar's core LNG processing operations, caused "extensive damage" to its energy hub. The United Arab Emirates also shut some energy operations, responding to incidents at the Habshan gas facilities and the Bab oil field caused by falling debris from intercepted missiles.
Saudi Arabia, meanwhile, said it had intercepted and destroyed four ballistic missiles launched towards Riyadh on Wednesday and an attempted drone attack on a gas facility.
Iran issued evacuation warnings before its attacks for several oil facilities across Saudi Arabia, the UAE and Qatar, as it prepared to retaliate for strikes on its own energy infrastructure in South Pars and Asaluyeh.
South Pars is the Iranian sector of the world's largest natural gas deposit, which Iran shares with US ally Qatar on the other side of the Gulf.
Oil prices are likely to remain supported as Iran's fresh strikes on Middle Eastern energy infrastructure deepen the regional tensions, with no sign of de-escalation in the conflict or a near-term reopening of the Strait of Hormuz, said Tina Teng, market strategist at Moomoo ANZ.
Reuters reported earlier that US President Donald Trump's administration is considering deploying thousands of US troops to reinforce its operation in the Middle East, as the US prepares for the next steps in its campaign against Iran.
Options include providing safe passage for oil tankers through the Strait of Hormuz, which would involve primarily air and naval forces, said the sources cited in the report, but securing the Strait could also mean deploying US troops.
