Oil Prices Surge Amid US-Iran Tensions, Inventory Decline

• Oil prices rose for a second day due to increased US-Iran geopolitical tensions after the US downed an Iranian drone near an American aircraft carrier in the Arabian Sea.
• West Texas Intermediate (WTI) climbed towards $64 a barrel, and Brent crude closed above $67.
• Despite the skirmish, diplomatic talks between the US and Iran are scheduled to continue, with negotiations set for Friday.
• US crude inventories significantly dropped by 11.1 million barrels last week, as reported by the American Petroleum Institute, indicating a potential major drawdown.
• A US-flagged oil tanker, Stena Imperative, was reportedly harassed by Iranian ships in the Strait of Hormuz, further escalating regional tensions.

Why It Matters: Geopolitical tensions between the US and Iran, coupled with declining US oil inventories, are driving oil price hikes.