(LONDON, UK) – The price of Brent crude oil climbed above $100 per barrel for the first time since May, driven by fears that the widening conflict in the Middle East could choke a vital export route for Saudi Arabian oil.
Brent, the global benchmark, jumped more than 6 percent on Thursday, briefly touching $100.14 per barrel before easing back slightly. West Texas Intermediate, the US benchmark, rose almost 5 percent to $90.98 per barrel. The surge adds to a remarkable run this month, with Brent up roughly $27 per barrel, a gain of more than one third. The last time the price sat above $100 was on 22 May.
The renewed supply fears followed attacks by Yemen’s Houthi rebels on Saudi vessels in the Red Sea. The Houthis claimed to have struck two Saudi tankers on Thursday, raising the prospect that a crucial shipping lane for global oil markets could be disrupted. Analysts note that the kingdom has been shipping between 4 million and 5 million barrels of oil per day via the Red Sea and the Bab el Mandeb strait, a route that avoids the Strait of Hormuz. That channel is now under direct threat.
The price move reflects deepening concern that the spread of hostilities could remove significant volumes of supply from an already tight global market. Traders are watching closely for any sign that Saudi export flows face physical interruption.