Thursday saw a 5% increase in oil prices, with both main benchmarks trading at above $100 per barrel as concerns about additional interruptions to already limited supplies were heightened by the largest increase in shipping strikes since the start of the Iran conflict.
By 11:49 a.m. ET (1549 GMT), Brent crude futures were up $5.39, or 5.33%, at $106.60 per barrel. West Texas Intermediate crude futures increased $5.16, or 5.37%, to $101.21 as US oil surpassed $100 a barrel for the first time since May. As fighting restarted and a permanent agreement between the United States and Iran to suspend assaults never materialised, Brent prices have risen by more than 30% from lows reached in early August.
The Houthis, who are affiliated with Iran, took over Yemen’s port of Mocha on Thursday, increasing the threat to Red Sea commerce. Meanwhile, Gulf traffic is still limited through the Strait of Hormuz due to the recent escalation of tanker strikes in the area.
According to Simon-Peter Massabni, head of business development at XS.com, attacks by Yemen on Saudi energy facilities provide a new source of market risk, extending worries beyond Iran and the Strait of Hormuz. The possibility of interruptions spreading to nearby export routes, oil producing facilities, and other energy infrastructure is now part of the threat, which is no longer limited to a single choke point.
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