U.S. crude oil rose nearly 3% on Wednesday as traders fear Israel could target Iran's oil infrastructure in retaliation for a ballistic missile attack.

Israel's ambassador to the United Nations, Danny Danon, vowed late Tuesday that Israel will exact a "painful" response against Iran. Danon's threat came hours after the Islamic Republic launched around 180 ballistic missiles at Israel in retaliation for the assassination of top Hamas and Hezbollah leaders.

Here are Wednesday's energy prices:

"The next turn in this retaliation spiral may very well involve oil - via the degrading of Iran's oil capacity or Iran's proxies attacking oil and gas shipping from the Persian Gulf," Piper Sandler analysts told clients in a Wednesday note. Israel might take aim at Iran's oil industry to hit Tehran's income and degrade its ability wage war, they said.