Brent Crude Surges Above $100 as Middle East Conflict Escalates
Oil prices surged on Wednesday as the conflict in the Middle East escalated and concerns over oil flows intensified. Brent crude futures rose $2.77, or 2.83%, to $100.69 a barrel by 12:26 GMT, breaking above $100 a barrel for the first time since June.
The Iran-backed Houthis launched attacks on energy facilities in Saudi Arabia this week, sparking fires at oil installations and threatening to significantly widen the conflict. The attacks also threaten crude shipments through the Red Sea, which had served as an alternative route to the vital Strait of Hormuz.
Supply risks have intensified, with banks including Goldman Sachs, Bank of America, and HSBC raising their crude oil price forecasts in recent days. Oil flows through the Strait of Hormuz have fallen sharply, ranging between around 8 million and 9 million barrels per day before falling to below 2 million barrels per day.
In the physical oil market, the Dated Brent benchmark has traded above $100 a barrel since September 3, according to LSEG data. European diesel futures were trading at around $199 a barrel on Wednesday, while gasoline prices have also been high throughout the year.