Oil gains over 1% on Middle East military tensions

Oil drilling rigs

Oil prices rose today, Oct. 3, on concerns that the escalating conflict in the Middle East could threaten supplies. However, a large build up in US crude inventories limited gains.

Brent crude was trading up 1.19% at $74.77 a barrel at 08:06 am Makkah time. WTI crude rose 1.36% to $71.05 a barrel.

The price-jump came after an Israeli strike on central Beirut early on Oct. 1 killed at least six people, following more than 180 missiles fired by Iran into Israel.

"I doubt Israel will target Iranian oil infrastructure," Tony Sycamore, Market Analyst at IG, told Reuters. "Such a move would likely push oil prices towards $80, which would be objectionable to Israel's allies, who are making progress against inflation."

 Data from the US Energy Information Administration showed that US crude inventories rose by 3.9 million barrels to 417 million barrels in the week ended Sept. 27, compared to expectations for a decrease by 1.3 million barrels.