Storm and Saudi Attacks Drive Oil Prices Higher
Oil prices climbed on Wednesday as concerns over potential supply disruptions grew due to an approaching storm in the US Gulf of Mexico and escalating attacks in Saudi Arabia. Brent futures gained 93 cents, or 0.92%, to reach $101.51 per barrel, while US West Texas Intermediate (WTI) crude rose 82 cents, or 0.92%, to $90.25.
US forecasters warned that a storm forming in the Gulf of Mexico could become the first Atlantic hurricane of 2026 within two days, threatening oil and gas facilities. The affected offshore areas produce 15% of US crude oil and 5% of natural gas. Analyst Tim Waterer from KCM Trade called the storm an “unwelcome complication,” noting it could disrupt production and refining at a time of existing supply challenges.
The storm could impact six refineries, which collectively represent about 50% of the US’s national refining capacity of 18.2 million barrels per day (bpd). Meanwhile, US crude oil and gasoline inventories declined last week, with crude stocks dropping by 2.09 million barrels.
Supply had been increasing as the East-West pipeline reached 5.8 million barrels a day, according to Saudi Energy Minister Prince Abdulaziz bin Salman. However, tensions flared as Yemen’s Iran-backed Houthis targeted Saudi airports in Jazan and Najran. Analyst Mukesh Sahdev from X Analysts suggested that attacks and refinery outages would likely keep prices elevated near the $100 mark without significant de-escalation.