0829 GMT February 26, 2020
Brent crude futures LCOc1 soared to a high of $70.74 a barrel and was at $69.38 at 1150 GMT, up 78 cents, or more than 1%, from Friday’s settlement, Reuters reported.
US West Texas Intermediate CLc1 crude was at $63.64 a barrel, up 59 cents, or 0.9%, after touching $64.72, the highest since April.
The gains extended Friday’s more than 3% surge after the US assassinated Iranian military commander Qassem Soleimani on Friday, heightening concerns about an escalation in conflict in the Middle East and the possible impact on oil supplies.
The region accounts for nearly half of the world’s oil production, while a fifth of the world’s oil shipments pass through the Strait of Hormuz.
On Sunday, US President Donald Trump threatened to impose sanctions on Iraq, the second largest producer among the Organization of the Petroleum Exporting Countries (OPEC), if US troops were forced to withdraw from the country.
Baghdad earlier called on US and other foreign troops to leave Iraq.
Trump also said that the United States would retaliate against Iran if Tehran were to strike back after the US assassination of Gen. Soleimani.
“The situation brings lots of uncertainty and geopolitical tea-leaf reading on reactions. While the closure of the Strait of Hormuz remains a very unlikely event, the deterioration in Iraq bears supply risks,” said Norbert Rucker, head of economics at Swiss bank Julius Baer.