Oil Surges as Supply Risks Push Brent Above $100

Key Moments

Front-month Brent for September delivery traded at $100.69 a barrel, gaining more than 7% on the day after touching an intraday high of $101.01.
Houthi claims of strikes on two Saudi oil tankers in the Bab el-Mandeb Strait and a declared blockade of Saudi exports have intensified concerns over Red Sea shipping.
Global supply pressures have broadened, with disruptions in Kazakhstan, Iraqi crude load suspensions by Indian refiners, and constrained Russian fuel exports tightening both futures and physical markets.

Benchmark Crude Breaks Back Into Triple Digits

Brent crude futures climbed back above $100 a barrel for the first time in nearly two months as mounting security risks to commercial shipping in the Red Sea stoked fears that the Middle East supply crisis is extending beyond the Strait of Hormuz.

As of mid-morning Thursday, the front-month Brent contract for September delivery was quoted at $100.69 a barrel, up more than 7% on the session after reaching an intraday peak of $101.01. West Texas Intermediate (WTI) also advanced sharply, and the entire Brent forward curve shifted higher as market participants incorporated the prospect of longer-lasting supply disruptions.

Contract	Price	Move	Comment
Brent front-month (September)	$100.69	+ more than 7% on the day	First move back above $100 in nearly two months; intraday high at $101.01

Red Sea Escalation Adds to Shipping and Supply Risks

The latest jump in prices followed claims from Houthi forces that they had targeted two Saudi oil tankers in the Bab el-Mandeb Strait after announcing a naval blockade of Saudi exports earlier in the week. In response, several vessels have reportedly rerouted or postponed their passage through this key chokepoint, endangering an export corridor that Saudi Arabia has used to circumvent disruptions in the Strait of Hormuz.

This development represents a further escalation for a market that had previously been positioned for an easing in geopolitical tension. Brent has now risen by roughly 20% over about two weeks as continued attacks on merchant shipping, renewed hostilities involving Iran, and rising export interruptions have progressively dismantled expectations of a swift normalization in global oil flows.

Supply Disruptions Spread Beyond the Middle East

The current rally is no longer centered solely on risks tied to Hormuz. Kazakhstan has started reducing oil output after drone attacks halted tanker loadings at the Caspian Pipeline Consortium terminal on the Black Sea. Indian state-owned refiners have paused Iraqi crude loadings due to shipping hazards in the Hormuz area. At the same time, Russian fuel exports remain limited following months of Ukrainian drone attacks on refineries.

These factors are adding to supply tightness in both the futures and physical markets.

Markets Tighten as Strategic and Commercial Buffers Erode

The physical market has tightened in tandem with derivatives pricing. Governments worldwide have already tapped hundreds of millions of barrels from strategic stockpiles since the onset of the Middle East conflict. Commercial inventories have dropped significantly, and China has scaled back imports by drawing down reserves built up before the war. These buffers are being steadily run down, leaving the market more exposed to fresh disruptions.

Triple-Digit Brent Undermines Hopes of Rapid Normalization

Brent’s return to prices above $100 a barrel has moved the market back into a range that many analysts previously believed had been averted after the U.S.-Iran memorandum of understanding briefly raised hopes that Middle Eastern exports would return to more normal levels.

Those expectations have deteriorated quickly as the conflict footprint widened from the Strait of Hormuz to the Red Sea, simultaneously endangering two of the world’s most critical oil shipping corridors and reinforcing the upside pressure on crude prices.