Oil prices rise amid reports Iranian consulate hit by missile strike in Damascus

Crude oil futures rose on the first day of second-quarter trading Monday amid reports that the Iranian consulate in Damascus, Syria, was hit by a missile strike.

The West Texas Intermediate contract for May delivery gained $1.28, or 1.54%, to $84.45 a barrel. The Brent contract for June delivery added 93 cents, or 1.07%, to $87.93 a barrel.

Syrian and Iranian state media said Monday that an Israeli missile strike hit the Iranian consulate in Damascus. A Lebanese security source told Reuters that a senior commander in the Iran’s Revolutionary Guard, Mohammad Reza Zahedi, was among the dead.

“This news, if confirmed, is a clear escalation of conflict in the Middle East and is likely to continue to bolster near-term oil prices,” Leo Mariani, an analyst with Roth MKM, told clients Monday.

Geopolitical risk remains present in the market as Ukraine strikes Russian oil refineries, and Houthi militant attacks in the Red Sea have led to the diversion of crude deliveries around the Cape of Good Hope in southern Africa.

Oil has also been grinding higher in 2024 on expectations of strong global demand as OPEC+ holds barrels off the market through at least the second quarter.

U.S. crude and Brent have booked three consecutive months of gains. WTI is up 17.8% for the year while Brent has risen 14.2%.