Oil prices rose more than $3 a barrel on Wednesday after joint strikes in Iraq by the United States and Saudi Arabia, and the interception of Iran's ballistic missiles aimed at U.S. forces in the Middle East, while U.S. crude inventories shrank.
Brent futures increased by $3.30, or 3.9%, to $87.39 a barrel by 0300 GMT, while U.S. West Texas Intermediate (WTI) crude rose $3.05, or 3.8%, to $82.31 a barrel. Reuters reported.
Renewed strength comes after the U.S. said it intercepted a surprise attack on U.S. troops," ING analysts said in a note.
"Saudi Arabia intercepted drones from Iranian-backed groups in Iraq, which were targeting Saudi energy infrastructure," they said, adding that U.S. and Saudi forces launched strikes on weapon sites across eastern Iraq.
The latest developments dampen expectations for a swift de-escalation in the Persian Gulf, they said.
