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FINWIRES

EMEA Oil Update: Brent Extends Gain on Middle East Escalation

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Brent crude benchmark rose for third day in a row on Wednesday, as Middle East hostilities flared with Iranian missile strikes on Kuwait and Bahrain.

Brent futures contract climbed 1.8% to $97.76 per barrel. Murban futures closed at $96.09 on June 2 and were not trading by the time of publication of this oil price update.

"Oil edged higher as the US-Iran standoff showed no visible progress toward reopening the Strait of Hormuz," Saxo Bank analysts said.

The immediate catalyst for the market rally was a severe outbreak of fresh regional hostilities, following reports of Iran firing missiles directly at Kuwait and Bahrain.

This military escalation coincided with a breakdown in peace negotiations.

ANZ noted that crude edged higher as broader diplomatic tracks struggled to stay viable, especially after media reports surfaced indicating that Hezbollah will not accept any partial ceasefire framework with Israel.

However, President Trump dismissed widespread media reports of a diplomatic freeze as "false and erroneous," insisting that backchannel discussions between Washington and Tehran remain fully active in a post on Truth Social.

Data released late Tuesday by the American Petroleum Institute revealed that US crude oil inventories plummeted by 6.75 million barrels for the week ended May 29.

The energy market is now awaiting US Energy Information Administration petroleum inventory report, scheduled for release later on Wednesday.

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