Oil prices climbed on October 8 as concerns over Middle East supply disruptions persisted, fueled by rising attacks on shipping in the Gulf and the Strait of Hormuz. Brent crude futures surged $1.33, or 1.33%, to $101.53 a barrel, while US West Texas Intermediate (WTI) crude futures rose $1.11, or 1.26%, to $89.39.
The price increase came despite a previous drop on October 7, following the International Energy Agency's decision to accelerate oil stock releases and prioritize diesel supplies under a plan launched in March. The move aimed to address record fuel prices and supply disruptions triggered by the Iran war.
Attacks on tankers in the Strait of Hormuz, a critical route for about 20% of global oil and fuel shipments, hit their highest level last week since the Iran war began. Despite the risks, Gulf producers are increasing exports, taking on higher costs and potential damage to cargoes and crew. A recent attack north of Qatar resulted in casualties, according to the United Kingdom Maritime Trade Operations agency.
Daniel Hynes, senior commodity strategist at ANZ, noted that past attacks led to reduced shipments, but producers are now more willing to take risks due to the lack of alternative routes. He also pointed out that the IEA’s oil release likely consists of barrels already part of their original 400-million-barrel plan, meaning it does not represent an additional draw on strategic inventories.
Supporting the price rise, US inventory data showed crude stockpiles fell by 3.2 million barrels, exceeding expectations. Meanwhile, diesel inventories declined slightly, remaining well below their typical levels for this time of year.