Brent crude oil prices hit $110 for first time since May as Iran attacks continue, Ukraine eyes Russia energy infra

Brent crude oil prices climbed sharply higher on Friday to clinch $110 for the first time since May as Iran intensified attacks in the Strait of Hormuz, Houthi militants launched missiles at Saudi Arabia and Ukraine pledged to resume strikes on Russian refineries, fuelling concerns over global energy supplies.

Crude oil prices this week

Brent crude futures touched $110 a barrel during the session, crossing that level for the first time since May, before easing to settle at $109.86, up 3.7%. US West Texas Intermediate (WTI) crude gained 3.5% to close at $101.41 a barrel. For the week, WTI rose more than 10%, while Brent advanced nearly 5%.

Saudi Arabia intercepted several missiles over the Red Sea on Friday, including one headed toward Yanbu, a key oil export terminal. The kingdom also destroyed three drones over Riyadh and its southern regions. Iran-backed Houthi militants in Yemen have launched repeated attacks on Saudi Arabia this week.


Earlier in the week, Aramco was also targeted on Tuesday, when one of the oil giant’s administrative buildings in Dhahran was hit. The Houthis had earlier attacked Riyadh’s international airport on October 10, killing 12 people and injuring more than 300.

Attacks in the Strait of Hormuz have added to concerns about oil shipments. At least nine tankers and cargo ships have come under attack since Sunday as Iran seeks to disrupt oil exports through the strategic waterway, per a CNBC report.

Iran sank the container ship GFS Pride on Wednesday, US Central Command said. The crew of the Singapore-registered vessel was safely evacuated, according to Singapore’s maritime authority. The International Maritime Organization said the attacks had left three seafarers injured and two missing this week.

Meanwhile, the energy ceasefire that US President Donald Trump sought to broker between Russia and Ukraine has quickly fallen apart. Moscow continued strikes on Ukrainian infrastructure despite the proposed truce, prompting Ukrainian President Volodymyr Zelenskyy to pledge renewed attacks on Russian refineries in retaliation.

Diesel prices have risen sharply this year amid Ukrainian attacks on Russian refineries and Iranian strikes on energy infrastructure across the Middle East. The fuel averaged $6.33 a gallon in the US on Friday, more than 70% higher than a year earlier, according to the report.

Where are prices headed?

Markets remain uncertain about how the conflict will develop. JPMorgan analysts said the war’s eventual trajectory was difficult to model. At the outset, the bank had expected the US administration to avoid crossing certain economic thresholds. Seven months into the conflict, many of those thresholds had been crossed, while a clear exit strategy remained elusive.

The risk of further supply disruptions has also strengthened expectations of higher oil prices. Daan Struyven, co-head of global commodities research at Goldman Sachs, said recent attacks underscored how disruptions to shipping could spread and intensify.

Goldman Sachs has outlined a scenario in which oil prices could rise to $120 a barrel if attacks on vessels in the Middle East escalate. A return to normal export levels, however, could bring prices down towards $80 a barrel. Struyven said shipping risks had become a major driver of oil prices and that the bank saw significant upside potential for crude. Goldman Sachs also expects natural gas and refined fuel prices to increase, with supply shocks having a greater impact on gas and refined products than on crude oil.

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