Oil prices extended their rebound on Wednesday after the United States and Saudi Arabia carried out joint strikes against Iran‑backed groups in Iraq. At 04:28 ET (08:28 GMT) Brent Oil Futures were up 4% at $87.47 a barrel, while WTI Crude Futures rose 3.9% to $82.31 a barrel, recovering from a three‑day decline that had seen both benchmarks fall roughly 15% from a Friday intraday peak near $93.50. The strikes were justified by the United States and Saudi Arabia as a response to recent drone attacks on Saudi oil facilities, a claim Tehran rejected as a "major miscalculation" and warned could exacerbate hostilities. Concurrently, the U.S. military intercepted multiple Iranian ballistic missiles aimed at American forces, reinforcing concerns that the recent lull in fighting could be short‑lived.
Diplomatic context included Israeli Prime Minister Benjamin Netanyahu’s meeting with U.S. President Donald Trump in Washington, after which Trump expressed optimism that talks with Iran might make progress, although Tehran denied seeking negotiations or a cease‑fire. ANZ analysts noted that efforts to reopen the Strait of Hormuz have stalled after Iran rejected an Omani‑backed proposal for a joint traffic‑management framework, and observed that only five commodity vessels transited the strait on Tuesday, indicating subdued tanker traffic.
On the supply side, the American Petroleum Institute reported an estimated decline of about 3.3 million barrels in U.S. crude inventories for the previous week, suggesting resilient demand ahead of the official government inventory data due later on Wednesday. Additionally, reports indicated that OPEC+ is contemplating a three‑month pause on further production increases starting in October, after completing the planned return of voluntary output cuts, which provided further support to crude prices.
Overall, the combination of renewed Middle‑East military actions, limited tanker movements through Hormuz, a reported draw in U.S. crude stocks, and potential OPEC+ production pauses contributed to the 4% rise in Brent and the 3.9% rise in WTI observed on the day.