Oil climbed for a third session as investors weighed President Donald Trump's latest tariff threats on Russian crude buyers and the possible fallout from Israel's strike in Doha.
Brent traded around $67 a barrel, extending this week's increase to more than 2%. Trump told European Union officials he's willing to slap new tariffs on India and China in an effort to get Russia to negotiate with Ukraine — but only if EU nations do so as well.
Meanwhile, Israel's attack targeting Hamas threatens to derail US-led efforts to end the Middle East conflict, reviving geopolitical risk premiums in crude prices. Israel has claimed full responsibility, while Trump distanced himself from the strike.
Brent has been stuck between $65 and $70 for more than a month now, with expectations of a glut toward the end of 2025 hanging over the market, but the Israeli attack on Qatar's capital has reignited concerns about an escalation of hostilities in the region. The Middle East is the source of about a third of the world's crude supplies.
Prices have been forced to wrestle with the competing forces of oversupply and geopolitical risk over the last two days.
On the one hand, Brent's prompt spread — the difference between its two closest contracts —closed at its weakest level since February on Tuesday, excluding expiry days. That softness reflects plentiful supply in northwest Europe. A US government report on Tuesday said the oversupply is already here.
In contrast options markets saw a small move upward in the cost of bullish calls. Periods of elevated geopolitical risk have generally been most clearly priced in the options space.
“It's been three days since the OPEC production hike, and yet the prices continue to stabilize in the $65/$70 range,” said Keshav Lohiya, founder of consultant Oilytics. “On the flip side of this peak bearish narrative is the heightened short-term geopolitical risk.”
Prices
Brent for November settlement gained 0.8% to $66.95 a barrel at 10:24 a.m. in London.
WTI for October delivery advanced 0.9% to $63.21 a barrel
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