Oil Jumps 6% to Clear $100 as Tanker Attacks Escalate
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Oil prices surged 6% on Thursday, pushing both major benchmarks past the $100-per-barrel mark. The spike was driven by the heaviest wave of shipping attacks since the outbreak of the Iran conflict, intensifying market anxieties over already constrained global supplies.
Brent crude rose by $5.87, or 5.8%, to reach $107.08 a barrel, marking its highest level since mid-May. Concurrently, West Texas Intermediate (WTI) crude futures jumped $5.57, or 5.8%, to settle at $101.62 a barrel, crossing $100 for the first time since May. Both benchmarks have climbed more than 30% from their August lows following the breakdown of potential ceasefire talks between the U.S. and Iran.
Geopolitical risks escalated further as Iran-aligned Houthi forces seized Yemen’s port of Mocha, threatening Red Sea shipping lanes. This comes alongside severe transit restrictions in the Strait of Hormuz due to a wave of recent tanker attacks. Simon-Peter Massabni, head of business development at XS.com, noted that Houthi attacks on Saudi energy facilities have broadened market risks beyond the Strait of Hormuz, threatening regional export routes, production sites, and vital energy infrastructure.
Meanwhile, U.S. President Donald Trump warned of potential strikes on Iran’s Pickaxe Mountain near the damaged Natanz nuclear site, suggesting the conflict could extend past the November midterm elections. Iran reported targeting 10 vessels near the Strait on Wednesday in retaliation for U.S. strikes on five Iranian tankers, with the Islamic Revolutionary Guard Corps warning of further escalations.
An S&P Global Energy analysis indicated that the market is adjusting to a “prolonged new normal” where supply disruption risks are persistent rather than temporary.
Analysts point to China’s importing behavior as a key factor for future price trends. According to ING, a recent rebound in Chinese crude purchases has strengthened physical markets. Continued buying from China could worsen the impact of supply shocks, whereas a slowdown in demand could cap price gains. David Jorbenaze of ICIS noted that weak Chinese demand had previously been the primary bearish factor for the market.
In the U.S., commercial crude inventories fell by 391,000 barrels last week to 424.1 million barrels, a smaller decline than the 1.55-million-barrel draw projected by analysts.
Additionally, OPEC lowered its 2026 global oil demand growth forecast to 380,000 barrels per day, marking its fifth consecutive monthly downgrade. A Reuters survey also revealed that OPEC production fell by 640,000 barrels per day in August, driven by war-related disruptions to Saudi exports and a U.S. blockade on Iranian shipments.
