Middle East Tensions Lift Energy Prices

Energy commodities climbed suddenly due to Israeli strikes on Iran, skyrocketing the geopolitical premium.

WTI futures soared on Middle East conflict

In late May, the eight key OPEC+ members stuck to their plan to add another 411 kb/d in July, the third monthly step in their 2025 unwind—leaving roughly 4.5 mb/d of cuts parked as spare capacity if the market softens.
Latest EIA report showed a 3.6 mb crude draw and stocks 8 % below the 5-yr norm, while refinery runs touched 94 % ahead of the driving season; yet Baker Hughes’ oil-and-gas rig count slid to 555 on 13 Jun, the lowest since ’21, flagging slower shale momentum.
Israel’s air-strikes on Iranian targets ignited Strait of Hormuz jitters and pushed WTI up 7 % in a day (to $72.98/bbl), its biggest intraday jump since 2022, even though physical exports remain unaffected so far.
Conflict headlines and tightening U.S. inventories lured funds back—CFTC data show money-manager net longs in NYMEX/ICE WTI up 15,157 lots to 121,911 in the week to 10 Jun, the strongest build of Q2 and a sign of momentum-driven buying.

Gasoline prices jumped on increased geopolitical and weather risk

U.S. gasoline stocks inched up 1.5 mb to 229.8 mb for the week to 6 Jun, still ~4 mb below last year; refiners lifted output to 9.5 mb/d, yet subdued imports kept days-supply at a lean 25.9.
Four-week implied consumption holds near 8.9 mb/d, and AAA logged record road-trip traffic over Memorial Day; the extra mileage has kept national pump prices around $3.10 /gal while steadily eroding the thin stock cushion.
NOAA’s above-normal Atlantic hurricane outlook and fresh Texas warnings have revived Gulf-refinery anxiety, while May outages on the West Coast drove gasoline imports to a four-year high—leaving a weather premium embedded in RBOB spreads.
Front-month RBOB surged 11 % from $2.02 to $2.23 /gal between 30 May and 13 Jun; open interest near 86k lots and heavier volumes suggest funds are rebuilding length to hedge hurricane risk and tightening U.S. balances.

Natural gas futures rose above $3.5 mark, as demand expects to lift

Three straight triple-digit builds (122 Bcf on May 30, 109 Bcf on Jun 6 and 101 Bcf the prior week) pushed working gas to 2.71 Tcf—about 5 % above the five-year average—keeping a fundamental cap on rallies despite early-summer heat.
Seasonal maintenance trimmed U.S. dry-gas output to roughly 105 Bcf/d, while LNG feedgas sank to 14 Bcf/d; traders expect both to rebound as Gulf plants exit outages just as hotter weather lifts power-burn demand.
Israel’s 13 Jun strikes on Iranian targets prompted a shutdown of the Leviathan field, slashing Israeli supply to Egypt and reviving Mideast LNG-route risk—one reason gas joined oil in a conflict-sparked bounce.
Front-month Henry Hub climbed about 4 % from $3.45 to $3.58, during the last two weeks; the Aug/Jul spread blew out to a record 11 ¢/MMBtu as funds rolled length into late-summer, and total NYMEX open interest hovers near 1.7 million contracts.