– Iran launches wave of missiles at Israel
– US Senate blocks measure to halt American air assault
– Traffic through Strait of Hormuz remains halted, production cuts widen
London — Oil prices rose on Thursday, extending a rally as the escalating U.S.-Israeli war with Iran continued to disrupt supplies, prompting some major producers to cut production and others to take measures to ensure supply security.
Brent crude was up $2.35, or 2.9%, at $83.75 per barrel by 0850 GMT, a fifth session of gains. U.S. West Texas Intermediate crude rose $2.42, or 3.2%, to $77.08.
Oil markets are tightening, with the Chinese government telling the largest oil refiners to suspend exports of diesel and gasoline, said PVM analyst John Evans.
European diesel futures reached their highest level since October 2022 at $1,130.
Crude oil markets remained on edge as they face ongoing risks to supply following the attacks in the Middle East, with concerns centred on trade flows through the Strait of Hormuz, ANZ analysts said in a note on Thursday.
Around 300 oil tankers remained inside the Strait as vessel traffic in and out of the chokepoint nearly halted following the outbreak of war, according to ship tracking data from Vortexa and Kpler that excludes some of the smallest tankers.
Iranian forces have struck oil tankers in or near the Strait of Hormuz. Explosions were reported overnight near a tanker off Kuwait, according to the United Kingdom Maritime Trade Operations.
Iran launched a wave of missiles at Israel early on Thursday, sending millions of residents into bomb shelters as the conflict entered its sixth day, and just hours after moves to halt the U.S. attacks were blocked in Washington.
On Wednesday, a U.S. submarine sank an Iranian warship off Sri Lanka, killing at least 80 people, and NATO air defences destroyed an Iranian ballistic missile fired towards Turkey.
The escalation came as the powerful son of Iran’s slain supreme leader emerged as a frontrunner to succeed him, suggesting Tehran was not about to buckle to pressure five days after the U.S. and Israel launched a military campaign that has killed hundreds and convulsed global markets.
Iraq, the second-largest crude producer in the Organization of the Petroleum Exporting Countries, has cut output by nearly 1.5 million barrels a day for lack of storage and an export route, officials told Reuters.
Qatar, the biggest liquefied natural gas producer in the Gulf, declared force majeure on gas exports on Wednesday, with sources saying a return to normal production volumes may take at least a month.
*Katya Golubkova & Siyi Liu. Editing: Jacqueine Wong, Tom Hogue & Jan Harvey – Reuters
