The global benchmark surged above triple digits on Thursday for the first time in two months, with futures up about 14% this week. West Texas Intermediate traded near $92.
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Brent crude traded above $100 a barrel after Houthi attacks on tankers in the Red Sea opened a new front in the Middle East conflict, while President Donald Trump threatened to extend US strikes on Iran.The global benchmark surged above triple digits on Thursday for the first time in two months, with futures up about 14% this week. West Texas Intermediate traded near $92. Trump threatened “major military punishment” for both Iran and the Houthis in the event of further attacks on vessels in the Red Sea, and told Axios he is considering a "massive attack" on the Islamic Republic.The market is also contending with attacks at the Caspian Pipeline Consortium terminal on Russia’s Black Sea coast, which exports most of Kazakhstan’s oil. Global inventories have been depleted by months of conflict in the Middle East, raising the risk of a supply crunch and a broader economic shock.Oil has rallied this month as hostilities between the US and Iran escalated in the Persian Gulf, snarling traffic through the Strait of Hormuz and hobbling flows of crude and liquefied natural gas. The first attacks on Saudi Arabian tankers by Iran-backed Houthi militants in the Red Sea have heightened concerns about broader supply disruptions across the region.“If Red Sea traffic is minimal, then we would forecast $120, kind of the inflection point for oil,” said Jay Hatfield, the chief executive officer at Infrastructure Capital Management LLC. “If there’s no transportation, then you need conservation. The way you get conservation is higher prices.”The Red Sea has become a crucial alternative export route for Saudi Arabia, allowing the kingdom to bypass Hormuz and continue shipping millions of barrels a day to global customers. Some Asian buyers are now in talks with state run Saudi Aramco to potentially divert flows through the Suez Canal and around Africa after the Houthi attacks, according to traders.The US launched its 13th consecutive day of strikes on Iran, with both sides dismissing the prospect of a near-term return to negotiations. Tehran warned it would retaliate against energy facilities in the region if Trump follows through on his threat to destroy bridges or power plants should Iran attack vessels in the Strait of Hormuz.In the Red Sea, two Chinese tankers exited via the Bab el-Mandeb chokepoint on Thursday loaded with Saudi crude, despite the Houthi attacks. The Yemen-based militant group has warned all vessels against calling at the kingdom’s ports.Trump warned “that from this point forth, any and all damages done to Ships, Cargo, or anything related thereto, will be paid for by Iranian Money that the United States has in its possession, and controls.” He did not provide details on how payments would work in the Truth Social post on Thursday evening.“The path of least resistance continues to point higher,” said Chris Weston, head of research at Pepperstone Group Ltd., referring to oil prices. Brent is likely to climb to $110 a barrel unless “we see a meaningful shift toward two-way negotiations and a clear path” to a peace agreement, he added.To get Bloomberg’s Energy Daily newsletter in your inbox, click here.More stories like this are available on bloomberg.com©2026 Bloomberg L.P.Published on July 24, 2026
