| Key Points: – Oil prices jumped over 4% after reports of a partial U.S. embassy evacuation in Iraq raised geopolitical concerns. – Additional support came from President Trump’s doubts over a nuclear deal with Iran, potentially limiting future oil supply. – A breakthrough in U.S.-China trade talks also boosted sentiment, helping crude extend its recent rally. |
Crude oil prices soared on Wednesday, climbing more than 4% amid escalating geopolitical tensions and renewed concerns over global supply disruptions. The sharp move followed reports that the U.S. embassy in Baghdad is preparing for a partial evacuation due to rising security threats.
West Texas Intermediate (WTI) crude futures closed at $68.15 per barrel, up 4.5%, while Brent crude, the global benchmark, settled at $69.77, a gain of 4%. The rally reflects growing unease in energy markets over the stability of the Middle East, a region critical to global oil production and transportation.
The price spike was triggered by a Reuters report indicating that U.S. and Iraqi officials are coordinating plans for an “ordered departure” of embassy personnel in Iraq. The development comes amid mounting threats in the region, raising fears that oil infrastructure or transportation routes could be impacted if tensions escalate further.
In addition to the embassy-related concerns, oil prices were also supported by comments from President Donald Trump, who expressed skepticism over the prospects of reaching a new nuclear agreement with Iran — a major oil-producing nation. Speaking during a podcast, Trump said his confidence in a deal had “diminished,” casting doubt on the potential return of sanctioned Iranian barrels to the market.
Oil prices found further support from signs of easing trade tensions between the U.S. and China. Following high-level discussions in London, both nations reportedly agreed to a framework aimed at reducing tariffs and improving trade flows. President Trump hinted that a formal agreement could be imminent, pending final approval from Chinese President Xi Jinping.
The latest surge adds to a month-long recovery in oil prices, which have rebounded from a sharp sell-off in April driven by global economic concerns and softer demand projections. Despite the rebound, both WTI and Brent remain down year-to-date, reflecting the broader market’s caution around demand durability and geopolitical risk.
Analysts are closely watching developments in the Middle East and diplomatic signals from Washington and Beijing, noting that any further escalation or policy shifts could significantly impact global supply dynamics in the weeks ahead