WTI climbs above $100.00 amid attack on Saudi infrastructure and Israeli election deadlock

• An electoral deadlock between Netanyahu and Eisenkot in Israel accompanies a rise in WTI.
• Meetings involving Saudi, Pakistani, Turkish and Iranian leaders give fresh impetus to regional diplomacy.
• Supply concerns intensify further following Houthi missile strikes on Saudi Arabia's largest oil refinery.

At around $100.30 per barrel in Wednesday's Asian trading, West Texas Intermediate (WTI) oil is recovering after two days of declines. The rise in crude prices comes as global markets scrutinise Israel's election results for signs of a possible shift in the course of the ongoing Middle East conflict.

With vote counting still under way, exit polls put Prime Minister Benjamin Netanyahu level with opposition leader Gadi Eisenkot, leaving neither bloc with a majority. Although the contest remains deadlocked, the results suggest support is ebbing for Netanyahu. He has dominated Israeli politics for decades and led the country through nearly three years of uninterrupted conflict.

Renewed regional diplomacy was also under market scrutiny after Iranian leaders met officials from Saudi Arabia, Pakistan and Turkey on Monday. Further impetus came from Iran's Supreme Leader Mojtaba Khamenei, who urged an end to the prevailing state of "neither war nor peace."

Escalating violence by Yemen's Iran-aligned Houthis nevertheless leaves the wider prospects for peace highly uncertain. Resuming attacks against major oil producer Saudi Arabia, the group said on Tuesday that it had used a ballistic missile to strike Ras Tanura, the kingdom's largest oil refinery.

Brent retains elevated risk premium as brinkmanship over Iran persists

Brent continues to face a highly charged geopolitical environment, according to Commerzbank analysts. US President Donald Trump recently threatened Iran, saying a decision would soon be made on whether to reach a deal or to “finish it off.” Commerzbank warns that “new US attacks on Iran could take place following the US mid-term elections next week,” while highlighting today's Israeli parliamentary election result as another potentially pivotal influence on the conflict's direction. A return to office for Israeli Prime Minister Benjamin Netanyahu could, the bank cautions, mean he “might attempt to achieve regime change in Iran,” further entrenching the risk premium already priced into oil.