Oil fund USO rises 1.44 per cent to $164.84 a share in pre-market trading on Middle East tensions

Market worry this week has centred on attacks on tankers near the Strait of Hormuz and on Saudi energy facilities, CNBC reported.

US crude futures, the WTI contract, rose more than $2 a barrel to $101.62 in pre-market trading on Friday, October 23.

CNBC reported on Wednesday, October 21, that market worry had centred on attacks on tankers near the Strait of Hormuz and on Saudi energy facilities. EnergyNow, citing Kpler, reported that at least 18 commercial vessels had been attacked in the two weeks before Tuesday, October 21.

WTI settled at $97.15 a barrel on Wednesday, October 21, down 67 cents. EnergyNow reported that WTI had traded above $100 a barrel earlier that week. Brent closed at $108.82 on Wednesday, CNBC reported.

Goldman Sachs put the global average crude freight rate above $20 a barrel in a report published on Tuesday, October 20, against $3 a year earlier, CNBC reported. Oilprice.com reported that JPMorgan had estimated Middle East crude exports at 17.5 million barrels a day, 98 per cent of pre-war levels, despite attacks on shipping.

WTI is now above $100 a barrel, and the move is tied to concern over escalating Middle East tensions. That makes it a reflection of expected disruption more than a loss of supply already in hand. Whether the premium holds will depend on whether the tensions reach production or shipping routes.