Brent Crude Surges Above $107 Amid Middle East Supply Disruptions

Global oil supplies remain under threat due to rising tensions in the Middle East. Brent crude prices have surged above $107 per barrel, up 3.20% from Monday's opening price. The increase is largely attributed to disruptions in shipping routes following the seizure of key ports by Houthi forces.

Reports suggest that Saudi Arabia has temporarily shut its East-West pipeline after drone attacks. Additionally, a merchant vessel was struck in the Strait of Hormuz on Sunday, further exacerbating supply concerns.

The recent rise in prices extends last week's rally, which pushed Brent and US benchmark West Texas Intermediate (WTI) back above $100 per barrel. The United States has carried out strikes along the Iranian coastline to challenge Iran's control over the Strait of Hormuz.

Saudi Arabia's oil production has also taken a hit, with August output reaching 6.2 million barrels per day - its lowest monthly total in 2023 and 23% below July's level. The decline is partly due to threats from Iranian-backed Houthi rebels in Yemen.