File photo of Israeli F-16 fighter jets performing during an air show above the beach in the Israeli coastal city of Tel Aviv, May 5, 2022.
Jack Guez | Afp | Getty Images
Crude oil prices rose Friday on reports that Israel is preparing for a direct attack by Iran this weekend, in the biggest escalation of tensions in the Middle East since the start of the war between Israel and Hamas last October.
THE West Texas Intermediate The contract for May delivery hit a session high of $87.67, while June Brent futures rebounded to $92.18. Exxon Mobile The stock hit an all-time intraday high of $123.74 as the oil rally boosted the energy sector.
U.S. crude ultimately gained 64 cents, or 0.75%, to settle at $85.66 a barrel, while the global benchmark settled at $90.45, up 0, 79% or 71 cents.
Israel is preparing for a direct attack by Iran on southern or northern Israel as early as Friday or Saturday, a person familiar with the matter told the Wall Street Journal. A person briefed by Iranian leaders told the Journal that no final decision had been made, although strike plans were under discussion.
People familiar with Western intelligence assessments told Bloomberg News that an attack by Iran, or its proxies, with drones and missiles against Israel could occur as soon as the next 48 hours.
The US Embassy in Jerusalem on Thursday banned government employees and their families from personal travel outside Tel Aviv, Jerusalem and Beersheba “out of an abundance of caution” until further notice.
Iran’s Supreme Leader Ayatollah Ali Khamenei has vowed to punish Israel for the missile attack on the Islamic Republic’s diplomatic building in Damascus, Syria, last week that killed seven Iranian military officials.
Oil prices rebounded after the attack, although futures are down slightly this week as inflation data and U.S. crude inventories weighed on the market.
Israel warned Iran that it would retaliate against the Islamic Republic if Tehran attacked Israel.
“If Iran attacks from its territory, Israel will react and attack in Iran,” Foreign Minister Israel Katz said at a news conference. social media platform Wednesday, tagging Khamenei.
Brent crude oil futures could hit $100 a barrel if Iran directly attacks Israel, according to Bob McNally, president of Rapidan Energy and a former top energy official in the Bush administration. If the escalation results in disruption of the Strait of Hormuz, a key trade route for oil, prices could rise to $120 or $130 a barrel, McNally told CNBC.
