WTI Crude Rises 2.6% on Middle East Tensions as Gold Falls 2.9%
New York crude oil futures climbed 2.6% amid renewed supply concerns, while gold futures slipped 2.9% on expectations of higher U.S. interest rates.
West Texas Intermediate (WTI) crude oil futures on the New York Mercantile Exchange gained 2.6% on the 12th, with the front-month December contract closing at $88.74 a barrel, up $2.21 from the prior session. The rise followed a retreat in optimism about U.S.–Iran negotiations, after President Trump posted on social media that "a deal with Iran is not necessary."
Supply worries were amplified by reports that Iran said four oil tankers were hit by explosions in the Strait of Hormuz, a key chokepoint for global oil shipments. The Iran-aligned Houthi group in Yemen also claimed attacks on Saudi pipeline facilities and an Aramco headquarters, while Ukraine reported a drone strike on Russia's Ust-Luga port that damaged fuel storage tanks.
Matador Economics chief economist Timothy Snyder said the series of attacks by Iran’s Revolutionary Guard, Russia and Ukraine is pushing oil prices higher and that investors are growing skeptical of any progress in peace talks.
Despite the price gains, OPEC+ data showed that October crude output rose, led by Saudi Arabia, and U.S. Energy Information Administration figures released on the 12th indicated that U.S. crude inventories increased, contrary to market expectations.
On the commodities front, gold futures on the New York Commodity Exchange fell for a third straight session, with the December contract settling at $3,885.3 an ounce, down $115.2 or 2.9%. The decline was linked to expectations that U.S. long-term interest rates could rise into the 5.1% range, reducing the appeal of non-yielding assets.
Market attention is now turning to the outcome of ongoing peace negotiations, including talks in Moscow involving Russian President Vladimir Putin and U.S. representatives, which could influence future sanctions on Russian crude.