Oil Prices Soar Above $100 as Middle East Tensions Escalate

Oil prices surged above $100 a barrel on September 9 for the first time in six weeks, driven by escalating attacks involving US and Iranian forces that have added to concerns over Middle East supplies.

The Brent global oil benchmark has gained around 25% since early last month as hopes for a permanent resolution to the six-month-old US-Iran conflict have faded. The rally accelerated this week after Iran-backed Houthi attacks on Saudi energy facilities set oil installations ablaze, raising the risk of wider disruptions across the Gulf.

'Oil investors are expressing their view about the impact of the latest bout of escalation in the Middle East in an unambiguous way,' said Tamas Varga, of oil broker PVM. 'They are voting with their dollar, and this vote strongly indicates that unless the Strait of Hormuz re-opens, and oil starts flowing again uninterruptedly, supply will not be aligned with demand in the foreseeable future.'

The US has drawn heavily on its Strategic Petroleum Reserve, which now holds 289.7 million barrels, its lowest level since 1982. The decline follows years of releases under former President Joe Biden and President Donald Trump aimed at cushioning consumers from high fuel prices.