Oil prices gained ground in Asian trading on Friday, driven by reports that Iran may be preparing a strike on Israel from Iraqi territory in the coming days.
This potential escalation in Middle Eastern tensions fueled market concerns, adding upward pressure on oil prices.
As of 2:40 pm AEDT (3:40 am GMT), the Brent crude December contract, which expired Thursday, climbed by 61 cents, or 0.9%, to US$73.16 per barrel. U.S. West Texas Intermediate (WTI) crude futures rose $1.24, or 1.8%, to $70.50 per barrel.
The reported threat emerged from Israeli intelligence sources, who indicated that Iran might be planning an attack on Israel from Iraqi soil, using a combination of drones and ballistic missiles.
According to Axios, Israeli officials suggested this attack could occur within days, potentially before the U.S. presidential election on November 5. The sources speculate that Iran's use of pro-Iranian militias in Iraq might be a strategic move to deflect Israeli retaliation against Iranian assets.
Investors will be monitoring a number of key events, with the U.S. election and a meeting of China’s top legislative body next week, as well as a looming decision from OPEC+ to start gradually reviving production from December.