Renewed upward trend in oil

Global benchmark Brent was trading around $90 a barrel after rising more than 2% in the previous session, while U.S. crude remained above $85. Israeli Prime Minister Benjamin Netanyahu said preparations were underway for an invasion.

These remarks reignited the war premium in oil futures, which had been declining over the past few days. Major threats in the Middle East, which accounts for about a third of the world's crude oil, include U.S. moves to restrict Iranian exports and potential disruptions to shipping.

According to the Wall Street Journal, the widely expected ground offensive had been delayed to allow the U.S. to deploy air defense systems in the region. Meanwhile, French President Emmanuel Macron said during his visit to the region that a major ground operation would be a mistake.

Standard Chartered Investment Strategist Han Zhong Liang said, "We think oil prices could rise as markets adjust to the possibility of the conflict escalating, and U.S. crude is likely to trade around $90 a barrel in the near term."

According to Energy Information Administration data, U.S. nationwide inventories outside the Middle East rose by 1.37 million barrels last week. Stocks at the Cushing, Oklahoma storage hub increased by 213 thousand barrels. Prices in physical oil markets worldwide are also seeing a decline as profits from fuels like gasoline decrease ahead of the winter season.

News Source: 12punto