Brent crude – a key benchmark for oil prices internationally – rose more than 1% to $74.40 a barrel.
During trading on Tuesday, it jumped more than 5%.
According to the US Energy Information Administration, Iran is the seventh-largest oil producer in the world and the third-largest member of the OPEC oil producers’ cartel.
Traders also fear any military escalation in the region could affect shipping through the Strait of Hormuz.
The shipping route between Oman and Iran is key to the global oil trade with 20% of the world’s supplies sailing through it.
Other OPEC members Saudi Arabia, the UAE, Kuwait, and Iraq also send most of the oil they export through the Strait.
Netanyahu vows response as Iran fires missile barrage
Meanwhile, Asia stocks sank on Wednesday, catching up with the sell-off on Wall Street after Iran’s ballistic missile strike on Israel provoked fears of a wider regional conflict.
Investors flocked to safer assets, pushing U.S. Treasury bond yields down in Asia, while gold hovered near an all-time high.
The safe-haven dollar traded close to its strongest in three weeks versus the euro.
Macroeconomics also buoyed the dollar, with a resilient U.S. job market arguing for a smaller Federal Reserve interest-rate cut in November, and eurozone inflation trends backing a European Central Bank easing this month
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