Global oil prices increased during early trading this week after Iran’s Islamic Revolutionary Guard Corps (IRGC) launched ballistic missile strikes against targets in northern Iraq and Syria. The price movement reflected market reactions to heightened geopolitical tensions in the Middle East.
On Tuesday, benchmark Brent crude futures rose 1.4% to $78.29 a barrel, while U.S. West Texas Intermediate (WTI) crude futures increased 1.2% to $72.56 a barrel, according to market data from Reuters. The rise continued a multi-session trend of price gains for both benchmarks.
The market activity followed an announcement from Iran’s IRGC on Monday evening. In a statement released through state media, the IRGC said it had launched ballistic missiles targeting what it described as an “espionage headquarters” for Israel’s Mossad intelligence agency in Erbil, the capital of Iraq’s semi-autonomous Kurdistan region. The IRGC linked the strike to recent Israeli actions that resulted in the deaths of Iranian commanders.
Additionally, the IRGC stated it fired missiles at targets in Syria, which it identified as locations associated with the Islamic State (IS) group. Iran attributed this action to retaliation for the twin bombings in Kerman, Iran, earlier in the month, for which IS claimed responsibility.
Iraqi officials condemned the strikes near Erbil as a violation of the country’s sovereignty. Iraq’s Ministry of Foreign Affairs recalled its ambassador from Tehran for consultations and summoned Iran’s charge d’affaires in Baghdad to deliver a formal protest. The Kurdistan Regional Government denied the presence of any Israeli intelligence center within its territory. Local authorities reported that the strikes hit a residential area, resulting in civilian casualties.
The United States also issued a response. U.S. State Department spokesperson Matthew Miller condemned the attacks in a public statement, describing them as “reckless missile strikes.” U.S. officials confirmed that no American personnel or facilities were targeted in the attacks, though the missiles landed in the vicinity of the U.S. consulate complex currently under construction in Erbil.
The price increases in the oil market occurred amid a broader context of regional instability. Analysts noted that ongoing attacks on commercial shipping vessels in the Red Sea by Yemen’s Houthi forces have also contributed to market uncertainty. These attacks, which the Houthis state are in support of Palestinians in Gaza, have prompted some major shipping companies to reroute vessels, raising concerns about potential disruptions to energy supply chains.
