FX.co ★ Oil Prices Extend Gains

Crude oil extended its rally above $81 per barrel on Friday, its highest level in a month, after Kuwait reported that Iran had attacked a power and water desalination plant. At the same time, multiple reports indicated that Iran launched strikes on US targets in Bahrain, Jordan, Kuwait, Oman, Qatar and Syria in retaliation for Washington’s latest round of military attacks. The US Central Command said it had carried out its sixth consecutive night of strikes against Iran, hitting dozens of military sites.

Additional reports suggested that Iran ordered Houthi forces to prepare to disrupt shipping in the Red Sea if the US were to target Iranian power infrastructure. Meanwhile, commercial traffic through the Strait of Hormuz has remained largely constrained. Oil prices are up more than 10% this week as escalating hostilities heighten fears of a wider regional conflict. Earlier in the week, the US reinstated a naval blockade on Iranian ports near the Strait of Hormuz.