Brent crude climbs back above 100 dollars amid G7 reserve release and Middle East tensions
Brent crude oil prices have surged back above $100 per barrel, despite efforts by the G7 to stabilize markets through reserve releases and improved supply from the Middle East. The benchmark European crude reached around $100.80 per barrel after earlier dipping to $97.50 during trading. Meanwhile, West Texas Intermediate (WTI), the U.S. benchmark, hovered near $90 per barrel, up from $87 earlier in the day.
The price rebound follows the G7's announcement to release 100 million barrels of crude and diesel over four months, a measure that began immediately. The French presidency of the G7 emphasized a significant diesel release in the first 20 days, though distribution details remain undisclosed. The International Energy Agency (IEA) and the European Union's Oil Coordination group are set to meet to discuss these developments.
The war in Iran has exacerbated pressure on refined products like diesel and gasoline, as conflicts in the Middle East and Ukraine have reduced operational refineries. Producers in the Persian Gulf are adjusting to new market conditions, with Saudi Arabia resuming operations of its East-West pipeline after an attack. Analysts from ING Think noted that Kuwait is producing at 75% of pre-war levels and Saudi Arabia has lowered the official selling price of its Arab Light crude for November deliveries.
Separately, an attack on a tanker in the Strait of Hormuz injured twelve sailors, including eleven Indians. Mohsen Rezai, leader of Iran's Supreme National Security Council, criticized U.S. economic pressure tactics, stating, "Your latest propaganda will also have a short shelf life. You lost the military war. You will also fail in the economic war."