Brent Crude Tests June-2022 Highs

Brent crude held above $100 per barrel on Thursday, hovering at its highest level since May as the intensifying conflict between the US and Iran raised concerns over further disruptions to energy supplies from the Middle East. Iran said it was ready for a more intense conflict, vowing to resist the US naval blockade and warning that it would intensify its attacks if American forces continued strikes on Iranian territory. Meanwhile, President Donald Trump predicted that the conflict would not end until after the November midterm elections and said significant relief in gasoline prices was unlikely before then, signaling limited prospects for near-term de-escalation. Hostilities intensified over the past week following roughly a month of relative calm, with both sides stepping up attacks. The conflict broadened after Iran-backed Houthi militants attacked several energy facilities in Saudi Arabia, prompting a temporary suspension of some operations.

Brent crude rose above $101.5 a barrel on Wednesday for the first time since May, driven by escalating US-Iran tensions. US officials reported that Iran attempted to attack Navy ships on Monday after targeting an aircraft carrier with ballistic missiles over the weekend, in a previously undisclosed wave of attacks. Meanwhile, Iranian state media said a US missile targeted a small oil tanker four miles from Kharg Island on Tuesday. The war broadened this week after Iran-backed Houthi militants attacked several energy facilities in Saudi Arabia, forcing a temporary halt to some operations. The attacks came after the US military struck three Iranian oil tankers on Saturday in retaliation for Iranian ballistic missile attacks on two Navy warships. Adding to upwards pressures on prices, US crude inventories fell by 0.3 million barrels last week. Meanwhile, Ukrainian drones hit infrastructure in Novorossiysk, Russia’s key oil terminal in the Black Sea, on Wednesday.

Brent crude rose above $101 a barrel on Wednesday for the first time since May, driven by escalating US-Iran tensions and stronger Chinese oil demand. The US military said it had destroyed five Iranian tankers carrying crude following attempts to strike a US Navy warship with ballistic missiles. Iran, meanwhile, claimed to have attacked two American vessels and eight oil tankers in the Gulf, while warning shipping crews near Kuwaiti and Bahraini ports to abandon their vessels. The escalation has heightened concerns over further disruption to global oil supplies, particularly around the Strait of Hormuz. Iran-backed Houthi militants also targeted energy infrastructure in southern Saudi Arabia, including the 400,000-barrel-a-day Jazan refinery. Meanwhile, purchases from China supported prices for African, Canadian and Latin American crude as the country restocks its dwindling oil and fuel inventories after limiting imports of more expensive product this year due to the war in Iran.