Oil jumps more than a dollar per barrel amid geopolitical tensions

Brent crude oil recorded an increase of more than a dollar per barrel today, Friday, as markets awaited a possible direct confrontation between Israel and Iran.

According to Reuters, Brent crude oil jumped $1, or 1.1%, to $91.65 a barrel by 1644 GMT. US West Texas Intermediate crude also rose 75 cents, or 0.87%, to $87.34 a barrel.

The two benchmarks reached their highest levels since October at settlement on Thursday.

The two crude oil prices are heading to record gains exceeding 4% this week, continuing to rise for the second week in a row after Iran, the third largest producer in OPEC, vowed to take revenge on Israel for an attack that resulted in the killing of a number of senior Iranian military personnel.

A NATO official said on Thursday that ongoing Ukrainian drone attacks on refineries in Russia may have disrupted more than 15% of Russia’s production capacity, hurting fuel production in the country.

The Organization of the Petroleum Exporting Countries (OPEC) and its allies, led by Russia, within the framework of what is known as the OPEC+ alliance, this week kept the oil supply policy unchanged and pressured some countries to increase commitment to production cuts.

The US jobs report on Friday showed that the number of new jobs in March rose at a faster-than-expected pace, and also showed steady growth in wages.

Nonfarm payrolls data point to potentially strong demand for oil, but could delay an expected interest rate cut by the Federal Reserve later this year.

This comes amid strong growth in global oil demand, which reached 1.4 million barrels per day in the first quarter, JP Morgan analysts said in a note.

They explained that their estimates “indicate that total oil consumption in March amounted to an average of 101.2 million barrels per day, which is 100,000 barrels per day” more than the estimates they had previously published.