Oil Prices Climb as Israel Strikes Hamas Targets and U.S. Eyes Russian Sanctions

Oil prices rose in Asian trading on Wednesday as escalating Middle East tensions and the threat of tighter U.S. sanctions on Russian energy boosted supply concerns. Brent crude futures gained 0.7% to $66.92 a barrel, while West Texas Intermediate rose 0.7% to $62.72 by 21:41 ET (01:41 GMT), marking a fourth straight session of gains. Prices were also supported after OPEC+ announced a smaller-than-expected production increase over the weekend.

Markets reacted sharply to Israel’s late-Tuesday strike on Hamas leadership in Doha, Qatar. The attack drew swift condemnation from Qatari and U.S. officials, raising fears it could derail ongoing peace talks. Oil spiked nearly 2% after the news before easing when U.S. officials stated no further strikes would occur. Hamas reported five casualties and accused Israel of attempting to assassinate its negotiating team. The move now clouds prospects for peace negotiations, leaving traders wary of prolonged instability in the region.

Geopolitical risks were further amplified by reports that U.S. President Donald Trump called for tougher measures against Russian oil. According to Reuters, Trump pushed for expanded sanctions and steep tariffs on India and China over their continued energy imports from Moscow. He has already imposed 50% tariffs on India and signaled a possible hike to 100% for both India and China. Such steps could reduce Russian oil revenues and disrupt global supply, although both countries have shown little willingness to halt purchases.

Adding to market uncertainty, U.S. crude inventories rose by 1.25 million barrels in the week to September 5, according to the American Petroleum Institute. Still, supply risks from the Middle East and Russia remain the dominant drivers, keeping oil prices on an upward trajectory.