Oil prices rose on Wednesday as escalating geopolitical tensions in the Middle East and the prospect of tougher US sanctions on Russia fueled supply concerns.
Brent crude climbed 0.7% to $66.85 per barrel, up from $66.38 in the previous session, while West Texas Intermediate (WTI) gained 0.7% to $62.95.
The rally followed Israeli airstrikes targeting senior Hamas leaders in Doha — an attack condemned by Qatar as “treacherous” and “state terrorism.” Qatar, alongside Egypt and the US, has been mediating cease-fire efforts in Gaza, where Israel’s war has killed more than 64,000 Palestinians since October 2023.
Adding to market unease, Russia launched its largest aerial assault on Ukraine since the start of the war, setting ablaze a government building in Kyiv. The attack prompted US President Donald Trump to warn of a “new phase of sanctions” against Moscow. The European Union’s sanctions envoy was also in Washington to coordinate further measures, raising the risk of tighter restrictions on Russian crude supplies.
Meanwhile, trade friction between the US and India persisted after Washington imposed tariffs of up to 50% on Indian imports in retaliation for New Delhi’s continued purchases of Russian oil. Trump said negotiations were ongoing to address the dispute.
On the supply side, US crude inventory data added another layer of uncertainty. The American Petroleum Institute reported a stock build of 1.25 million barrels for the week ending September 5, compared with forecasts of a 622,000-barrel increase, signaling weaker demand.
Analysts said the combination of geopolitical flashpoints and potential new sanctions on Russia is likely to keep oil markets volatile in the near term.
