Oil prices jump as tensions in Middle East spike

The price of crude oil increased Wednesday as concerns worsen over a new conflict in the Middle East after an apparent Israeli air strike killed the leader of Hamas inside Iran.

West Texas crude jumped in price Wednesday by more than $3 per barrel to about $78, a more than 4 percent increase.

Hamas leader Ismail Haniyeh was killed in the early hours of Wednesday inside a home in Tehran after he attended the inauguration of Iran’s new president. Israel has not taken responsibility for the strike, though the country’s military vowed to eliminate Hamas and its leaders in the months following the Oct. 7 attack that sparked the ongoing war in the region.

The strike has raised worries that Iran could move into more serious conflict with Israel. A similar Israeli strike on a Hamas leader in Beirut earlier Tuesday also worsened tensions with Hezbollah in the region.

Iranian Supreme Leader Ayatollah Ali Khamenei vowed revenge for the attack, saying it “paved the way for a harsh punishment” for Israel.

A widened conflict in the Middle East could drive up oil prices further, an effect that would trickle down to gas prices. Despite recent tensions, gas prices have stayed steady in the last month.

The average price of gas in the U.S. is about $3.49 per gallon, according to AAA. That’s lower than at this point last July, which averaged $3.76 per gallon.