Oil prices soared in Asia on Wednesday as Western powers prepared for possible military action against Syria over the regime’s alleged use of chemical weapons.
Analysts say a military strike targeting President Bashar al-Assad’s regime could further ratchet up tensions in the oil-producing Middle East, already wracked by the festering political crisis in Egypt.
New York’s main contract, West Texas Intermediate (WTI) for delivery in October, was up $2.95 to $111.96 a barrel in afternoon Asian trade. The contract hit an intra-day high of $112.23 a barrel.
Brent North Sea crude for October surged $2.81 to $117.17 after striking an intra-day high of $117.22.
“The potential for military action [against Syria] in a matter of days or weeks has helped to lift oil prices,” said Michael McCarthy, chief market strategist at CMC Markets in Sydney.
French President Francois Hollande said Tuesday that “France is ready to punish those who took the vile decision to gas innocent people,” adding that he had decided to increase France’s military support to Syrian rebels.
U.S. Defense Secretary Chuck Hagel on Tuesday underlined preparations for possible military strikes against Syria.
“The risks of oil remain, in terms of the potential for disruption of trade and shipping routes in the region,” said McCarthy.