Oil is on track for its strongest week in more than a year as the conflict in the Middle East ratcheted up amid Israeli air strikes on Lebanese capital Beirut.

Brent crude, the global benchmark, steaded overnight at less than $78 a barrel a day after surging 5pc as President Joe Biden said the US was discussing whether to support potential Israeli attacks on Iranian oil plants.

Crude has soared by nearly 8pc this week, its strongest rise since April 2023, amid fears that the conflict could become a wider war in the Middle East.

Citigroup estimated that a major strike by Israel on Iran’s export capacity could take 1.5m barrels of daily supply off the market. 

If Israel struck minor infrastructure, 300,000 to 450,000 barrels could be lost.

Vishnu Varathan, the Asia head of economics and strategy at Mizuho Bank, said there are “fears that Israel will target Iran’s oil production capabilities, so as to hit Iran where it hurts – its pocket”.

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