Emmanuel Addeh in Abuja
Global oil prices rose yesterday, with Brent crude settling at $95.63 per barrel, as renewed military exchanges between the United States and Iran heightened concerns over further disruptions to global energy supplies and shipping through the Strait of Hormuz.
Brent crude futures gained 98 cents, or 1 per cent, to settle at $95.63 per barrel, while the United States West Texas Intermediate crude rose 79 cents, or 0.9 per cent, to close at $91.01 per barrel.
Both benchmarks traded sharply during the session, swinging between gains of as much as $2 per barrel and losses of about $1, with their intraday highs reaching the highest levels since July 24.
The increase came as the United States and Iran exchanged their most significant attacks in weeks, raising fresh concerns about physical oil flows through the Middle East.
US forces struck targets along Iran’s southern coast, including air defence systems, radar installations, maritime assets, mine-laying capabilities and communications sites, while Tehran retaliated with attacks on US positions across the region.
“The latest strikes mark a significant escalation after roughly a month of relative calm, with the US targeting Iranian radar and mine-laying capabilities and Iran retaliating against US positions across the region,” Director at Liquidity Energy, Mark Schaefer, said.
“The key concern for the oil market is whether the renewed fighting leads to another deterioration in physical flows through the region,” he added.
The renewed hostilities have intensified concerns over the Strait of Hormuz, one of the world’s most strategically important energy corridors, which accounted for about a fifth of global oil and liquefied natural gas consumption before the conflict.
Iran’s Islamic Revolutionary Guard Corps said the latest US attacks would further restrict traffic through the waterway, while preliminary shipping data showed that only four commodity vessels transited the Strait of Hormuz on Wednesday, compared with a 10-day average of about 13 vessels.
Iran also said two oil tankers were struck by sea mines and disabled while attempting to transit the strait.
The Iranian government has meanwhile expanded the number of vessels it considers non-compliant and subject to fines, confiscation or detention if they attempt to sail through the strategic waterway without Tehran’s permission.
However, US Secretary of Energy, Chris Wright, said more than 17 million barrels of oil transited the Strait of Hormuz on Monday, describing it as the largest volume of crude to pass through the waterway since the conflict began.
The latest escalation comes as countries around the world continue to seek alternative sources of crude and draw down strategic reserves to cushion the impact of supply disruptions.
In addition to developments in the Middle East, Russia carried out missile and drone attacks on energy infrastructure in Ukraine’s southern Odesa region overnight, adding to broader concerns about global energy security.
Oil prices also received support from tighter US crude inventories. The US Energy Information Administration said crude stocks fell by 4.5 million barrels last week, significantly above analysts’ expectations of a draw of about 1.1 million barrels.
Meanwhile, the Organisation of Petroleum Exporting Countries and its allies, known as OPEC+, are expected to keep their oil output policy unchanged for October when the group meets on Sunday, according to sources familiar with the matter.
The producer group is completing the unwinding of one layer of production cuts this month and is expected to shift attention towards negotiations over production quotas for 2027.