Global oil prices have surged, with Brent crude reaching a five-month high amid escalating tensions in the Middle East. The price of Brent crude futures climbed 0.7% to $113.96 per barrel after peaking at $114.72, marking the highest level since May. Meanwhile, US West Texas Intermediate (WTI) crude saw an increase of 1.1%, reaching $100.57 per barrel.
The recent rise in prices is largely attributed to concerns over potential disruptions to energy supplies following Houthi attacks in Saudi Arabia. The situation intensified as reports emerged that Saudi Aramco ordered the evacuation of its headquarters in Dhahran due to the escalating conflict involving Saudi Arabia and Yemen-based Houthi forces. Analysts caution that continued attacks could further disrupt oil shipments and exacerbate supply shortages.
Security concerns have also extended to the Bab el-Mandeb Strait, a critical shipping route linking the Red Sea and the Gulf of Aden, where prolonged disruptions could delay energy deliveries and sustain elevated oil prices. Additionally, in Libya, the closure of a pipeline valve connecting the Hamada and Tahara oilfields to the Zawiya port has curtailed production at both fields, adding to global supply worries.
Compounding these issues, a Malta-flagged tanker carrying 40,000 metric tons of Russian diesel is en route to New York. This development comes as Russia resumes diesel exports to international markets, including the United States, in an effort to alleviate fuel-price pressures.
The oil market remains sensitive to developments in the Middle East and the extent of shipping disruptions, with the timeline for restoring affected energy operations uncertain. Market participants are closely monitoring the situation as it unfolds, with further volatility anticipated in the near term.