Oil prices jump 2% on Middle East escalations

Oil drilling rigs

Oil prices rose on Friday trading as geopolitical risks resurfaced following media reports that Iran is preparing to launch an attack on Israel through its proxies in the Middle East.

Brent crude futures for January delivery—the most active contract—rose 1.98%, or $1.44, to $74.25 at 9:14 a.m. KSA time. Meanwhile, prices of US WTI crude futures for December delivery jumped 2.14%, or $1.48, to $70.74 a barrel.

This comes after the news site Axios reported, citing sources within Israeli intelligence, that Iran is planning an attack on Israel through affiliated entities and is expected to use ballistic missiles and drones in the strike.

Direct clashes between Tehran and Tel Aviv have erupted recently after an Israeli escalation against Iran’s regional allies, such as Hezbollah in Lebanon, and targeting some of its leaders.

Crude prices received additional support this week amid reports that the OPEC+ alliance might consider delaying a scheduled production increase by the end of the year.

However, oil remains on track for a weekly loss of about 1% as geopolitical risk premiums subsided on Monday, Oct. 28, following a limited Israeli escalation against Iran.