Middle East Tensions Spark Oil Price Surge Amid Shipping Disruptions

Oil prices surged toward $100 per barrel on Tuesday as renewed attacks in the Middle East intensified concerns about global supply. Brent crude futures briefly crossed $99 earlier in the day before pairing some gains, while U.S. West Texas Intermediate futures climbed above $92.

The immediate catalyst for the price increase was a wave of Houthi attacks on southern Saudi Arabia, which injured 73 people and caused fires and temporary shutdowns at several energy sites. The kingdom reported strikes on energy and civilian facilities in cities including Jazan, Abha, Najran, and Khamis Mushait.

The disruption has raised fresh concerns about Saudi Arabia's ability to maintain exports while shipping routes remain under pressure. Goldman Sachs has raised its oil price forecasts this week, citing the prospect of prolonged shipping disruptions. The bank now expects Brent to trade at $85 a barrel in December and WTI at $80, both $5 above its previous estimates.

Goldman warned that Brent could reach or exceed $120 if Gulf production and exports remain significantly constrained, particularly if attacks on vessels in the Strait of Hormuz and Red Sea intensify. The bank's baseline projections remain below current prices, but their downside supply scenario is considerably more severe.