Oil Prices Surge 5.7% as Middle East Structural Risks and Inventory Draws Mount

WTI crude oil prices rallied by 5.7% as escalating geopolitical tensions in the Middle East fueled significant market volatility. A sharp widening of the Oman–Dubai price spread has emerged as a critical signal, highlighting deep structural risks to regional supply chains. This upward momentum was further supported by a substantial slump in EIA inventories, which significantly tightened the physical market outlook. The combination of these factors triggered a rapid unwind of speculative short positions, resulting in a technical short squeeze. Analysts suggest that the convergence of declining US stockpiles and regional instability is providing strong fundamental support for crude benchmarks. Market participants remain highly sensitive to any further developments that could disrupt global energy flows from key regional corridors.