HOUSTON: Brent crude futures breached $100 a barrel on Wednesday for the first time since late July after Iran and the US struck tankers in the biggest wave of attacks on shipping since the war began, threatening to worsen the ongoing impairment of energy supplies from the Middle East.
Front-month Brent crude futures were up $3.04, or 3.1 per cent, at $100.95 a barrel as of 1739 GMT, after touching a high of $101.58. US West Texas Intermediate crude was up $2.75, or 3pc, at $95.78 a barrel, its highest level since early June. Since late May, oil benchmarks have generally traded well below the $100-per-barrel psychological threshold, reflecting expectations that the conflict would remain on a low simmer.
Optimism rose in particular after the US and Iran came to a temporary agreement to cease attacks, even though a permanent peace deal has not been reached. That calculus has been shifting of late with the resumption of strikes.
Iran said on Wednesday it had attacked 10 ships near the Strait of Hormuz, and the US sank five Iranian oil tankers. “The move towards and back above $100 Brent is reflecting a market that increasingly has to change its view on how long the Middle East crisis will continue to curb supply from the region,” said Ole Hansen, head of commodity strategy at Saxo Bank.
