Oil rose after Israel said its military struck Hezbollah's main headquarters in southern Beirut, ramping up tensions in the Middle East.
West Texas Intermediate advanced about 1% to more than $68 a barrel while Brent crude climbed toward $72 a barrel. Both grades still were on pace for weekly declines amid the prospect of rising supplies from Saudi Arabia and Libya.
The strike came after Israel vowed to continue bombarding Hezbollah targets in Lebanon indefinitely, undermining efforts to secure a cease-fire that could ease the risk of a regional war. The flare-up helped blunt the bearish effect of a report that Saudi Arabia was said to be committed to higher production. Rival Libyan factions this week agreed to appoint a new central bank governor, a step toward resolving a dispute that has slashed oil output.
Crude is on track for a quarterly decline amid OPEC+'s plans to ease voluntary supply curbs, as well as top importer China's tough economic outlook. The Asian nation unveiled a slew of monetary and fiscal stimulus measures this week, aiding stocks as well as some commodities, but their effectiveness remains uncertain.
The price swings have pushed a gauge of implied volatility for WTI higher. Options markets are now pricing in a lower risk of oil futures spiking, with the premium of bearish puts — which profit from lower prices — over bullish calls growing in recent days.
Meanwhile, Tropical Storm Helene is triggering dangerous rain and flooding across the US South, where it has killed at least four people and cut power to nearly 4 million customers as of Friday morning.
WTI for November delivery rose 1% to $68.34 a barrel at 12:12 p.m. in New York. Brent for November settlement advanced 0.7% to $72.13 a barrel.
Source : Bloomberg
