Oil prices climbed about 2% to a five-month high on Thursday after Houthi attacks in Saudi Arabia stoked concerns of further disruption to energy supplies from the key exporting region.
Brent futures rose $2.42, or 2.2%, to $111.24 a barrel at 10:45 a.m. EDT (1445 GMT), while US West Texas Intermediate (WTI) crude rose $1.14, or 1.2%, to $98.29.
That drove Brent into technically overbought territory for a third time in a week and set for its highest close since May 18.
Saudi Aramco has told staff to evacuate its
headquarters in Dhahran on the Gulf near Bahrain, Reuters
reported, as fighting between the world’s largest crude exporter
and Yemen’s Houthis intensifies.
Clashes between the Houthis and a Saudi-led coalition that
backs Yemen’s internationally recognised government have raged
since the Iran-aligned group pushed towards Bab el-Mandeb, a
shipping chokepoint at the Red Sea’s mouth.
“Reports of Middle East crude oil exports exceeding
pre-conflict levels are more than countered by attacks on ships
in the Strait of Hormuz and the Houthi strikes on Saudi Arabia
and on its oil infrastructure,” PVM Oil analyst Tamas Varga
said.
“No de-escalation is anticipated until the US midterm
elections, which should keep oil prices elevated.”
Morgan Stanley analysts estimated that Middle East crude oil
exports were around 17 million barrels per day last week. Crude
exports from the region averaged about 18 million bpd in the 12
months before the start of the Iran war, according to Kpler.
In the US, refiner Valero Energy posted its
highest-ever quarterly profit, beating Wall Street expectations,
as disruptions caused by the Middle East conflict sent refining
margins soaring during the third quarter.
AROUND THE WORLD
Russia pounded Kyiv with ballistic missiles and Ukraine sent
hundreds of drones towards Moscow overnight as the two sides
kept up a barrage despite the latest US push to end the war.
Russia said on Wednesday it was ready to resume US-mediated
talks with Ukraine next month, after President Vladimir Putin
hosted US envoy Steve Witkoff for talks in St Petersburg.
Ukrainian President Volodymyr Zelenskiy said he hoped
negotiations, which would be the first since February, would
take place early in November.
Russia was the world’s third-biggest crude oil producer
behind the US and Saudi Arabia in 2025, US energy data showed.
Sanctions designed to keep Russian energy out of global markets
after Moscow’s invasion of Ukraine have helped support oil
prices.
Any deal to end the war which began with Russia’s invasion
of Ukraine in February 2022 could allow Russia to export more.
Senior Russian political and energy officials urged the
European Union on Thursday to reconsider its plans to ban
imports of Russian LNG, arguing the bloc’s low storage levels
had put Europe in a precarious position.
The European Parliament, meanwhile, approved a three-year
delay to EU methane emissions rules for oil and gas imports,
after pressure from governments including France and the US.
In Libya, an oil pipeline valve from the Hamada and Tahara
oilfields to Zawiya port has been shut, leading to a reduction
in production at both fields, the head of the National Oil
Corporation told Reuters on Thursday.
Source: Khaleej Times