09:01 AM EDT, 10/02/2024 (MT Newswires) -- Oil traded sharply higher for a second day on Wednesday on heightened worries over a spreading Middle Eastern war that could threaten Persian Gulf oil supplies.

West Texas Intermediate crude for November delivery was last seen up US$2.14 to US$71.97 per barrel, the highest since Aug.30, while December Brent crude, the global benchmark, was up US$2.04 to US$75.60.

The rise comes after Iran on Tuesday launched an estimated 180 ballistic and hypersonic missiles at Israel in retaliation for the killing of Hassan Nasrallah, leader of the Hezbollah militia in Lebanon, along with other senior leaders of the Iran-backed group.

There were no injuries reported in Israel from the strike, according to The Guardian, and most of the missiles were destroyed by air defenses. Still, Israel and the United States are threatening to retaliate against Iran for the attack, which could threaten the country's oil infrastructure and its 1.7-million barrels per day of exports.

"While multiple geopolitical price spikes this past year deflated almost as soon as they emerged, the recent escalation poses a threat to supply, primarily arising from the risk of an Israeli counterattack on Iran's nuclear and energy infrastructure," Saxo Bank noted.

The heightened tensions have added support to a market depressed by weak demand from China, the forecast return of around half a million barrels per day of Libyan supplies and expectations OPEC+ will begin unwinding 2.2-million bpd of voluntary production cuts in December.

A smaller-than-expected drop in U.S. inventories last week is also shading fundamentals for oil. The American Petroleum Institute on Tuesday reported U.S oil stocks fell by 1.5-million barrels last week, under the consensus estimate for a 2.1-million barrel drop, according to Oilprice.com. The Energy Information Administration will report official data later on Wednesday morning.