Oil prices climbed Thursday, October 22, as concerns about a possible escalation in the Middle East intensified following a report that the U.S. and Israel were preparing plans for renewed strikes on Iran after next month's U.S. midterm elections.
Key Takeaways
- Brent rose 3.1% to $112.20 a barrel, while WTI gained 2.79% to $99.86.
- The New York Times reported strike preparations, citing unnamed U.S. officials.
- A U.S. order for non-emergency government employees and their families to leave applies only to Saudi Arabia.
Table of Contents
- Oil prices rise on escalation concerns
- U.S. clarifies Saudi Arabia departure order
- Portfolio manager sees a smaller household burden
- Conclusion
Oil prices rise on escalation concerns
Brent crude futures reached $112.20 a barrel as of 4:12 a.m. ET, up 3.1%. U.S. West Texas Intermediate crude advanced 2.79% to $99.86 as traders faced renewed uncertainty over the conflict.
The New York Times reported that U.S. and Israeli military officials had drawn up specific plans for fresh strikes against Iran. Citing unnamed U.S. officials, the newspaper said preparations for a short, intensive operation were progressing. The report concerned planned action after the elections, rather than strikes already carried out.
U.S. clarifies Saudi Arabia departure order
The U.S. has ordered non-emergency government employees and their families to leave Saudi Arabia. State Department spokesman Tommy Pigott said on X that the directive applied only to that country, following reports suggesting departures had been ordered elsewhere in the Gulf.
Pigott cited increasing attacks on civilian targets by the Iran-aligned Houthis.
Portfolio manager sees a smaller household burden
David Wagner, head of equity and portfolio manager at Aptus Capital Advisors, argued that elevated crude prices may inflict less economic damage than in previous decades because consumers have become less exposed to energy shocks.
He noted that oil remained well below its inflation-adjusted historical highs. Citing U.S. government data, Wagner said gasoline accounted for roughly 5% of the average American's disposable income a decade ago, compared with about half that share today. In his view, that leaves households better positioned to absorb higher energy costs.
Conclusion
The rise in crude reflected concern over a possible escalation, with the reported military plans still prospective. Wagner's assessment offered a more measured view of the potential burden on consumers.
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