Brent crude reached $112 per barrel on Thursday, its highest level since May, after a series of security incidents in the Middle East threatened regional oil infrastructure. Yemeni Houthis, backed by Iran, conducted attacks on Saudi targets on Wednesday that resulted in casualties at a civilian airport in Dammam and at an oilfield. In related developments, Iran’s Islamic Revolutionary Guard Corps reported striking vessels in the northern Gulf engaged in what it characterized as illegal oil transfers, and indicated that three additional ships struck mines near the strait of Hormuz.
The incidents prompted defensive measures from Western nations and major energy companies. The United States instructed diplomats and family members to depart certain Saudi Arabian facilities, with broader withdrawals planned across Middle Eastern diplomatic missions. Saudi Aramco, the region’s leading oil producer, directed its workforce at headquarters in Dhahran to transition to remote operations.
Regional tensions have escalated nearly eight months following earlier confrontations that disrupted the critical strait of Hormuz. Oil prices had previously spiked above $100 per barrel during that conflict, with some analysts projecting peaks near $150 if flows through the strait were halted entirely. Prices peaked at $126 in April before declining, though they have resumed climbing following the breakdown of diplomatic negotiations between the United States and Iran.
Despite current price increases, export data indicated that oil shipments from the Persian Gulf have surpassed prewar volumes, supported partly by pipeline routes redirecting crude to the Red Sea and Gulf of Oman. Global financial markets experienced declines on Thursday, with European and Asian stock indices falling amid expectations of increased inflation and rising borrowing costs. American Airlines warned investors of substantial financial losses for the year due to elevated fuel expenses, abandoning previous profit forecasts.
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