WTI above $62.50 on Israel plans to hit Iran nuclear sites

West Texas Intermediate (WTI) extended its gains for the fourth successive day, trading around $62.70 per barrel during European session on Wednesday.

Crude oil prices surged following the news of Israel planning to strike nuclear facilities in Iran, which could destabilise oil supply from the Middle East region. However, CNN cited officials saying it was not clear that Israeli leaders had made a final decision.

An Israeli attack could upset flows from Iran, the third-largest oil-producing country among OPEC members.

Oil prices rise as supply concerns increase if Iran may retaliate and block the waterways through the Strait of Hormuz, raising concerns about crude oil exports from major Gulf countries like Saudi Arabia, Kuwait, Iraq and the United Arab Emirates.

The upside of crude oil prices could be restrained due to improving supply in the US, the world’s biggest oil consumer.

American Petroleum Institute (API) Weekly Crude Oil Stock rose by 2.49 million barrels in the previous week, lower than the previous increase of 4.28 million-barrel increase the week before, but against the expected 1.85 million-barrel draw.

Investors are looking ahead to the crude Oil Stocks Change from the Energy Information Administration (EIA) later on Wednesday.

Moreover, oil production in Kazakhstan increased by 2% in May, following a decline of 3% in April, although it still exceeded its OPEC+ quota. This increase has defied pressure from OPEC+ on the country to reduce its output.

(Source: OANDA)