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OIL: Oil End of Day Europe: Biden Comments on Iran Prompt Crude Surge

OIL
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Oil prices sharply gained on Thursday after Biden made a remark about potential Israel retaliations on Iranian oil infrastructure. They surged +5% before giving back some of the gains as markets asses the implications of the vague comments. 

  • Brent DEC 24 up 3.7% at 76.67$/bbl
  • WTI NOV 24 up 4% at 72.91$/bbl
  • Asked if he would support Israel striking Iran’s oil reserves in retaliation for Tuesday's missile attack, Biden said, “We’re in discussions of that” but “there’s nothing going to happen today; we’ll talk about that later.” CNN reporter Natasha Bertrand said via X.
  • Crude surged to a new high in terms of the geopolitical risk premium that has built in since Nasrallah’s assassination in Lebanon on Friday which kicked off the latest escalations.
  • Oil markets had largely given up pricing in a Middle East premium until the latest escalations.
  • Oil faced some bearish pressure earlier in the session as Libyan officials said all oil production in the country was being restored lifting force majeure measures at all ports and fields, including the biggest in the country, Sharara. This was largely expected though exact details remained.
  • Sharara has been offline the longest, coming off in early August, well ahead of the rest of the infrastructure.
  • A surge in crude call options volatilities and volumes this week has taken the near-term call-put skew back into positive territory reflecting the heightened upside price risk.
  • Repairs at Kazakhstan’s giant Kashagan field have been postponed until October 7 the energy ministry said to Reuters on Thursday, suggesting a 4-day delay.
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Oil prices sharply gained on Thursday after Biden made a remark about potential Israel retaliations on Iranian oil infrastructure. They surged +5% before giving back some of the gains as markets asses the implications of the vague comments. 

  • Brent DEC 24 up 3.7% at 76.67$/bbl
  • WTI NOV 24 up 4% at 72.91$/bbl
  • Asked if he would support Israel striking Iran’s oil reserves in retaliation for Tuesday's missile attack, Biden said, “We’re in discussions of that” but “there’s nothing going to happen today; we’ll talk about that later.” CNN reporter Natasha Bertrand said via X.
  • Crude surged to a new high in terms of the geopolitical risk premium that has built in since Nasrallah’s assassination in Lebanon on Friday which kicked off the latest escalations.
  • Oil markets had largely given up pricing in a Middle East premium until the latest escalations.
  • Oil faced some bearish pressure earlier in the session as Libyan officials said all oil production in the country was being restored lifting force majeure measures at all ports and fields, including the biggest in the country, Sharara. This was largely expected though exact details remained.
  • Sharara has been offline the longest, coming off in early August, well ahead of the rest of the infrastructure.
  • A surge in crude call options volatilities and volumes this week has taken the near-term call-put skew back into positive territory reflecting the heightened upside price risk.
  • Repairs at Kazakhstan’s giant Kashagan field have been postponed until October 7 the energy ministry said to Reuters on Thursday, suggesting a 4-day delay.