The black viscous hydrocarbon spiked high on Friday after Israel executed a large preemptive strike on Iran, heightening concerns of a wider conflict in the Middle East and significant disruptions to oil supply routes.
Brent Oil Futures for July delivery gained over 9%, trading at $75.15 per barrel, the highest price since early February.
West Texas Intermediate (WTI) crude futures increased to $74 per barrel, posting a 10% increase at their peak.
The Nigerian naira outlook has brightened as crude oil passed the FG benchmark for the first time. The benchmark for Crude oil under the FG Budget was $75 a barrel.
Israel’s attack
Reports have shown that Israel executed a large preemptive airstrike on Iran early Friday, hitting “dozens” of military and nuclear infrastructure facilities.
“Iran’s expectation of a retroactive strike is not out of the question. We can expect a retaliation drone assault on Israel and its territories,” said Defence Minister Israel Katz in an announcement about the strike.
Multiple Israeli aircraft launched an initial wave of strikes on numerous Iranian nuclear and military facilities. Alarm systems have also been activated in anticipation of possible Iranian missile strikes aimed at Israel’s ballistic infrastructures. Since the initial wave of attacks, the IDF has continued to operate as part of its ongoing campaign.
Prime Minister Benjamin Netanyahu also disclosed that Iran is actively working on the development of tens of thousands of ballistic missiles. Even in scenarios where such missiles lack nuclear warheads, their deployment could result in the death of millions of Israelis.
US negotiations with Iran
U.S. negotiators were set to meet Iran in Oman on Sunday over Tehran’s nuclear program. However, Trump publicly stated this week that he remains less optimistic about the chances of a deal coming together.
The operation “will continue for as many days as it takes to remove this threat,” said Israeli Prime Minister Benjamin Netanyahu. Iranian state television reported the death of Hossein Salami, confirming his leadership role within the Islamic Revolutionary Guard Corps.
An Israeli military source reported that the country had killed several nuclear scientists and senior Iranian generals in the strikes. It was also reported on Iranian state television that Hossein Salami, commander of the Islamic Revolutionary Guard Corps, was among the dead.
Israeli aircraft hit additional military and nuclear facilities situated in Iran’s western region on Friday morning. An Iranian official said, “The response to the Israeli attack will be harsh and decisive,” and that the timeline of “Iran’s plans to retaliate are being discussed at the highest levels” when questioned about Iran’s anticipated response.
Strong Economic data from the world’s largest economy also boosted buying pressure in the crude oil market.
Solid employment and inflation figures released from the US have fueled speculation regarding the possibility of the Fed cutting rates later this year. Recurring claims for unemployment benefits rose to their highest level since late 2021, while another survey showed US Producer Price Inflation remained subdued in May.
