05:08 AM EDT, 07/31/2024 (MT Newswires) -- Crude oil prices surged early Wednesday following news that a senior Hamas leader had been killed in Iran, boosting tensions in the Middle East.

The news came a day after the Israeli government claimed it killed a Hezbollah senior commander in an airstrike on Beirut, retaliating against a cross-border rocket attack on Israel over the weekend.

Brent crude gained 1.8% to US$80.04/b and West Texas Intermediate crude rose 2% to US$76.25/b at last look early Wednesday.

Demand concerns continue to put pressure on prices, tempering the rise in prices, ANZ Bank said in a Wednesday note. A weak crack spread in China is delaying refinery restarts and recovery in utilization rates, resulting in diminishing hopes of a material demand recovery in the second quarter, the bank noted.

Meanwhile, oil processing in Europe is strengthening and the U.S. refinery utilization rate is above 90% as margins improved after a recent fall in crude prices.

Stronger-than-expected U.S. oil inventory withdrawals this week should help prices stabilize, ANZ Bank said.