Brent crude oil has moved sharply towards $100 a barrel, reaching its highest level since July 23, as fresh attacks on Saudi Arabia’s energy infrastructure raise fears of further disruption to global oil supplies.
Brent rose to around $98.44 a barrel on Tuesday, September 8, up about 1.32% from the previous day. The benchmark has gained more than 12% over the past month and is nearly 48% higher than a year ago, according to market data.
The latest jump came after Iran-backed Houthi militants launched attacks on several cities in southern Saudi Arabia, hitting energy facilities and disrupting operations. Saudi authorities said the attacks wounded 73 people, while the Houthis claimed responsibility for strikes targeting the Jazan refinery, which has a capacity of about 400,000 barrels per day, alongside other facilities serving the domestic market.
The attacks have added another layer of uncertainty to an oil market already dealing with disruptions across the Middle East. Investors are particularly concerned that continued attacks could affect production, refining and the movement of crude from the region, putting further pressure on already tight supplies.
The Strait of Hormuz remains another major concern. The waterway is a critical route for global energy shipments, and uncertainty over the security of vessels passing through it has kept traders on edge. Iran and Oman have been discussing arrangements that could provide a temporary safe-passage route, but concerns over the safety of shipping remain.
For the oil market, that means the prospect of disruption is being priced alongside actual supply losses. Brent’s move towards $100 reflects not only what has already been taken offline, but also fears about what could happen if attacks spread or shipping through key routes becomes more difficult.
China is providing some support on the demand side. The world’s largest crude importer brought in about 37.93 million tonnes of crude in August, equivalent to roughly 8.93 million barrels per day, up 6.2% from July. Stronger purchases have provided additional support to oil prices, although Chinese crude imports remain below levels recorded before the escalation of the Iran conflict.
The combination of supply disruptions, heightened geopolitical risks and renewed Chinese buying has pushed Brent close to the psychologically important $100-a-barrel mark.
The renewed surge in crude prices has also revived concerns for oil-importing countries, which remain vulnerable to swings in global energy markets. A prolonged rise in crude prices could increase the cost of importing refined petroleum products, putting pressure on domestic fuel prices and, in turn, raising transport and operating costs across the economy.
Higher energy and logistics costs can eventually feed into the prices of goods and services as businesses pass part of the additional costs on to consumers. The extent of the impact will depend largely on how long crude prices remain elevated, movements in local currencies against the US dollar and conditions in domestic fuel markets.
For now, the immediate question for global markets is whether Brent will break decisively above $100 a barrel, or whether diplomatic efforts around the region can ease the supply and shipping risks that have pushed prices sharply higher.
