Oil Supply Risks Fuel Price Surge Amid Middle East Tensions

Oil prices have extended their rally as supply risks continue to build across key export routes. The Brent crude price is trading in the mid-$90 USD range, while WTI is near $87 USD. This surge reflects renewed tension in the Middle East, particularly around the Strait of Hormuz and the Bab al-Mandeb.

Traffic through these critical shipping lanes has fallen sharply, with traders now reacting to actual route disruptions rather than just headline risks. Two tankers reversed course in the Red Sea after threats, highlighting how quickly shipping behavior is changing as the security environment deteriorates.

The Caspian Pipeline Consortium terminal has become another pressure point, with loadings at the Novorossiysk terminal disrupted following tanker attacks. This adds fresh concern around Kazakhstan's crude exports and reinforces the view that the market is facing multiple supply shocks at once.