Brent Crude Hits $110 as Middle East Supply Risks Mount

Brent crude futures climbed by $1.21 to reach $110 per barrel on Wednesday, driven by heightened fears of supply disruptions stemming from intensifying attacks and threats across the Middle East. U.S. West Texas Intermediate also gained more than a dollar, settling at $99 per barrel.

Shipping Risks and Regional Threats

Traders exhibited caution regarding shipment hazards through the Red Sea and potential threats to Saudi Arabian oil infrastructure, according to Reuters. This volatility followed a previous trading session where prices had declined.

Kpler, a vessel tracking firm, reported in a Monday memo that at least 18 attacks on ships occurred within the Strait of Hormuz over a two-week period. Analysts at the London Stock Exchange Group noted in a separate memo that attacks on oil tankers have extended beyond the Strait of Hormuz.

U.S. Inventory Data and Fuel Production

In the United States, two Department of Energy officials stated on Tuesday that efforts are underway with global refining companies to boost fuel production. This initiative comes after diesel shortages contributed to rising prices.

Market sources cited American Petroleum Institute data on Tuesday, indicating that U.S. stocks for crude oil, distillates, and gasoline all fell during the previous week. Specifically, crude inventories dropped by 4.9 million barrels, while gasoline stocks decreased by approximately 2 million barrels. Distillate inventories saw a reduction of about 2.6 million barrels compared to the prior week.