Oil Prices Hit $100 per Barrel as Middle East Conflict Escalates

Brent crude briefly traded at $100 per barrel, its highest level since July, while U.S. crude rose to $94 per barrel. The surge follows a day of intensified hostilities that saw the United States strike four Iranian tankers in the Gulf of Oman and one near Iran’s Kharg Island, and Iran-backed Houthi rebels attack Saudi Arabian oil facilities. Traders cite the renewed threat to tanker traffic through the Strait of Hormuz as the primary driver of the price jump.

Global oil prices hit $100 per barrel as conflicts worsen in Middle East CNN

U.S. Central Command confirmed the strikes were a response to attempted ballistic-missile attacks on a U.S. Navy warship. In retaliation, Tehran’s Revolutionary Guards announced attacks on 20 U.S. vessels attempting to pass the strait. Earlier, on March 12, Brent first settled above $100 this year, a level not seen since 2022. A satellite image from September 8 showed smoke over a Saudi Aramco distribution centre after Houthi attacks in Abha, underscoring the widening scope of the conflict to the Red Sea and Bab al-Mandab Strait.

Global oil prices hit $100 per barrel as conflicts worsen in Middle East

• Brent and U.S. crude are each up more than 60 % year-to-date.

Global oil prices hit $100 per barrel as conflicts worsen in Middle East

• The U.S. national average diesel price hit a record $5.90 per gallon, according to AAA data.

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• The S&P 500 fell 0.6 % on Tuesday, extending a decline of less than 2 % since mid-August.

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• Bond yields have risen globally as investors anticipate possible central-bank rate hikes.

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• Analysts note that China, the world’s largest oil importer, has curbed imports, helping temper price gains; a rebound in Chinese demand could push prices higher.

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U.S. Central Command stated the tanker strikes were a defensive measure against missile threats. Tehran’s Revolutionary Guards claimed responsibility for striking 20 U.S. vessels, asserting continued control over the Strait of Hormuz. Commodity strategists and traders highlighted the volatility, noting that transportation volumes can shift rapidly in the region.

Global oil prices hit $100 per barrel as conflicts worsen in Middle East

• “The combination of expensive diesel, jet fuel, bunker fuel and natural gas is particularly uncomfortable for consumers around the world, who see their disposable income shrinking,” — Ole Hansen, head of commodity strategy at Saxo Bank

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• “Traders will remain focused on how transportation volumes are moving out of the Middle East, as it now seems volumes can change very quickly,” — Dennis Kissler, senior vice president of trading at BOK Financial

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