Crude oil prices experienced an increase on Monday, October 12. This upward trend is attributed to the escalation of conflicts in the Middle East and recent Houthi attacks from Yemen on Saudi Arabia and oil tankers in the region. These developments have further raised concerns about disruptions in oil supply from the Middle East.
Increase in Crude Oil Prices
Brent crude oil prices rose by 76 cents, equivalent to 0.73%, reaching $105.48 per barrel. Additionally, U.S. West Texas Intermediate crude also increased by 59 cents, or 0.64%, to $92.44. This price increase occurs amid rising attacks on oil tankers in the Strait of Hormuz, which could disrupt the recovery of crude oil exports from the Middle East.
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Serious Risks for Oil Tankers
The UK Maritime Trade Operations Center has reported that an oil tanker near the port of Sohar, Oman, was targeted in a drone attack, and another tanker was damaged by an unidentified projectile while passing through the Strait of Hormuz. The Islamic Revolutionary Guard Corps has also reported that three tankers collided with sea mines and caught fire. According to the IRGC, these tankers encountered mines while navigating unauthorized routes.
The IRGC has also warned that vessels that turn off their navigation and identification systems in the Strait of Hormuz will be considered hostile and will be engaged. This increase in tensions in the region, especially following Houthi attacks on Saudi Arabia, has led to rising oil prices. In recent attacks on Riyadh International Airport, 14 people were killed and over 300 were injured.
Donald Trump, the President of the United States, has also announced that Washington is considering participation in Saudi attacks on the Houthis. Furthermore, Goldman Sachs has raised its forecast for Brent oil prices in December from $85 to $90 per barrel. Analysts at the bank believe that renewed escalation of conflicts could further increase oil prices and estimate that over $20 of the price per barrel is due to existing risks.
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