13.06.2025 01:33

West Texas Intermediate (WTI) crude oil surged past the $72.00 mark in early Asian trading on Friday, fueled by escalating geopolitical tensions in the Middle East. This represents a significant daily increase of 6.20%, pushing WTI to its highest point since February.

The dramatic price rise is directly attributable to Israel's recent airstrikes targeting Iranian facilities. These actions, described by Israeli Defense Minister Israel Katz as a preemptive strike and followed by Prime Minister Benjamin Netanyahu's confirmation of attacks on Iran's nuclear enrichment program, including its main Natanz facility, have ignited fears of wider regional conflict. Netanyahu’s statement that the operation will continue for an unspecified duration only serves to heighten those anxieties.

This heightened uncertainty within a region responsible for a substantial third of global crude oil production significantly increases the perceived risk of supply disruptions. As Warren Patterson, head of commodities strategy at ING Groep NV, aptly stated, "The oil market is on tenterhooks, now factoring in a larger risk premium to account for potential supply interruptions stemming from the heightened geopolitical uncertainty."

However, countervailing pressures exist. The threat of new unilateral tariffs from US President Donald Trump, despite claims of a finalized trade deal with China lacking Chinese confirmation, could dampen WTI's upward trajectory. Trump's announcement of impending letters to numerous US trading partners, foreshadowing tariff implementations before the July 9th deadline, introduces an element of economic uncertainty capable of influencing oil prices. The full impact of this conflicting economic and geopolitical landscape remains to be seen.