Oil rises as hospital blast ratchets up Middle East tensions
BNN Bloomberg
Oil rose after Iran called for an embargo against Israel by Muslim countries, following a deadly explosion at a Gaza hospital that raised the risk of wider hostilities in the Middle East.
West Texas Intermediate settled above US$88 a barrel after earlier leaping to $90 on increased geopolitical tensions. Iran’s foreign minister called for a full and immediate boycott of Israel by Muslim countries, including an oil embargo on the country. While Israel’s oil imports are small in the context of global supply, and little of them come from the Middle East, the comments marked a verbal escalation over the war between Israel and Hamas.
The comments follow a blast at a hospital in Gaza City that killed hundreds. Leaders of Jordan, Egypt and the Palestinian Authority canceled a summit with U.S. President Joe Biden, complicating his push to ensure the Israel-Hamas conflict doesn’t widen across the region. Biden arrived in Israel early Wednesday.
Meanwhile, traders are assessing dwindling U.S. stockpiles. Inventories at the largest storage hub in Cushing, Oklahoma, dropped to 21 million barrels, the lowest since 2014. Supplies at the location are nearing minimum operating requirements, and many traders consider the inventories to already be at the lowest levels that allow tanks to function normally.
