Geopolitical Risks Keep Brent Crude Near $100

Brent crude oil prices have remained firmly supported around the $100 per barrel mark, driven by escalating geopolitical risks in the Persian Gulf. Despite signs of improving oil supply, concerns about potential disruptions continue to keep prices elevated. Analysts from ING, Warren Patterson and Ewa Manthey, noted that while oil flows from the region are recovering, market sentiment remains fragile due to ongoing risks.

Recent attacks on Saudi Arabia's East-West pipeline have heightened fears about the reliability of regional supply routes. Though the latest attack did not disrupt flows, it serves as a reminder of the persistent threats to infrastructure. Meanwhile, Gulf producers are adjusting their output and pricing strategies in response to the volatile situation. Kuwait has reduced its production to 75% of pre-war levels, and Saudi Arabia has cut the official selling price of its Arab Light crude for November loadings.

Beyond oil, the European natural gas market remains vulnerable as storage levels lag behind previous years. Current storage stands just under 73% full, significantly below last year's 83% and the five-year average of 88%. This leaves the market exposed heading into the winter season, despite a recent uptick in liquefied natural gas shipments from the Persian Gulf.