Oil Prices Edge Higher After Israeli Strikes, but Oversupply Threatens Outlook

Oil prices gained ground on Wednesday following heightened geopolitical tensions, though oversupply concerns restricted further increases. Brent crude climbed 1% to $67.05 a barrel, while U.S. West Texas Intermediate (WTI) rose 1.1% to $63.31. The rise came after Israel confirmed strikes targeting Hamas leadership in Doha, prompting an initial 2% jump in crude futures before prices eased back. Tensions further escalated when Poland shot down drones during a Russian assault on western Ukraine, marking the first NATO engagement in the conflict. However, analysts noted that without direct supply disruption, risk premiums in oil markets tend to fade quickly. Adding to global pressure, U.S. President Donald Trump urged the European Union to impose 100% tariffs on China and India—two of Russia’s key oil buyers. EU officials, currently in Washington, said they are weighing faster steps to cut dependence on Russian fossil fuels. Despite the geopolitical backdrop, fundamentals remain bearish. The U.S. Energy Information Administration (EIA) warned that rising inventories, driven by increased OPEC+ output, will likely weigh on prices in coming months. API data also showed higher U.S. crude and fuel stocks last week. Official government figures are expected later today.