Oil prices experienced a modest increase in early trading on Wednesday, driven by heightened concerns over potential supply disruptions. This uptick followed reports that U.S. forces commenced strikes on Iranian military targets for the 11th consecutive night, alongside Kuwait’s announcement of drone attacks attributed to Iran. Brent crude futures experienced an increase of 0.55%, equating to 50 cents, reaching a price of $91.51 following the market’s opening on Wednesday. Meanwhile, U.S. West Texas Intermediate crude saw a rise of 0.36%, or 30 cents, bringing its price to $84.64 amidst low volume trading.

This follows the recent settlement of oil prices at a five-week high on Tuesday, coinciding with U.S. military actions targeting locations in southern and western Iran, alongside Iranian assaults on U.S. facilities in Bahrain, Kuwait, and Jordan. The U.S. military announced that it commenced its most recent strikes on Iran late Tuesday in the United States, or early Wednesday in Iran. The U.S. attacks occurred shortly after the Kuwaiti army reported that its air defences were intercepting Iranian drones on Wednesday.

The ongoing trading of strikes has heightened concerns regarding potential disruptions to global energy supplies, following the Yemen-based Houthis, aligned with Iran, escalating the conflict by threatening to target vessels transporting Saudi oil in the Bab el-Mandeb Strait and declaring a naval blockade against Saudi Arabia. The Bab el-Mandeb waterway at the southern entrance to the Red Sea has gained significance as a route for Saudi crude exports, particularly in light of the sharp decline in traffic through the Strait of Hormuz following the recent collapse of the ceasefire between the United States and Iran earlier this month.

Separately, Pete Hegseth, the U.S. defence secretary, stated that the country’s war in Iran has incurred costs of $37.5 billion to date, reflecting an increase of nearly $8 billion since the previous public estimate. Data indicated that U.S. crude and distillate inventories experienced an increase last week, whereas petrol stockpiles saw a decline, according to market sources. The inventory data precedes the official figures from the U.S. Energy Information Administration scheduled for release on Wednesday.