Crude oil prices rose sharply Wednesday after President Donald Trump said the U.S. will hit Iran hard in retaliation for an attempted surprise attack on American forces in the Middle East.
Brent crude futures, the international benchmark, gained 6.6% to $89.61 a barrel. U.S. West Texas Intermediate futures advanced 6.4% to $84.31.
Trump told Fox News that Iran "is going to get a beating" after the Islamic Revolutionary Guard Corps launched ballistic missiles at U.S. forces. "We'll be hitting them hard," the president said.
Regional Escalation
- Iran targeted a U.S. base in Jordan, according to a report from Axios. U.S. Central Command said the missiles were successfully intercepted.
- U.S. and Saudi forces struck "multiple terrorist logistics and weapons sites" in eastern Iraq on Tuesday, retaliating against more than 30 drone attacks in the past three days by "Iran-aligned terrorists," Centcom said.
- The U.K. Maritime Trade Operations Centre reported "suspicious activity." The master of a tanker heard an explosion while transiting the southern Red Sea, UKMTO said. The advisory was issued Tuesday, while the incident was reported Monday.
- Houthi attacks targeting Saudi oil facilities have also raised supply concerns. Houthi strikes on oil production, storage and port infrastructure could disrupt supply across the region, Bjorn Vang Jensen, executive industry advisor at Xeneta, said on CNBC's "Access Middle East" on Tuesday.
The spike in oil prices has been compounded by Chairman Kevin Warsh's somewhat hawkish tone at his first FOMC meeting as Fed chair, and traders remain split on the central bank's decision due Wednesday, according to Kitco.
