Oil Prices Teeter Near $100 as Supply and Geopolitical Risks Clash
Brent crude oil prices hovered just above the critical $100 per barrel mark on Tuesday, while West Texas Intermediate (WTI) hovered near $90. Traders are weighing a recent recovery in Middle East exports against ongoing attacks on energy infrastructure. Brent was trading around $100.60, and WTI near $89.70 in Asian hours. The market has repeatedly tested the $100 level after a two-week low, but supply security remains fragile.
The bearish case for oil prices has strengthened. The G7 nations agreed to release 100 million barrels of crude and diesel from emergency reserves over four months, with an early focus on diesel. OPEC+ kept November production targets unchanged, while Middle East crude exports climbed back towards pre-war levels late last month. Kpler data show regional exports exceeded the pre-war average of about 18 million barrels a day on four days in the final week of September, reaching as high as 22.5 million barrels a day.
Despite these improvements, the geopolitical backdrop remains volatile. Yemen’s Houthis claimed attacks on Saudi airports, military sites, and an Aramco refinery at Rabigh. Shipping through the Gulf remains expensive and dangerous, with tanker shuttle routes costing as much as $40 million per round trip. Refined-product flows also remain weaker than crude flows, keeping diesel markets unusually tight.
The next break in oil prices will depend on whether supply normalisation proves durable. If Gulf exports remain near pre-war levels and diesel tightness eases, Brent could lose its $100 floor and move towards the mid-$90s. However, the downside is not clean, as OPEC+ producers are still pumping below headline quotas, tanker attacks are increasing, and global inventories remain tight after months of disruption.