Brent Rises Near $110 on Increasing Supply Risks

Brent crude prices surged toward $110 a barrel on Friday, rising more than 5% this week amid tightening supply and strong demand for fuel from the shipping industry. Producers are facing higher freight rates and risk premiums to transport cargoes through the Strait of Hormuz, keeping uncertainty over future regional supply elevated. Iranian strikes on tankers in the strait have sharply reduced oil flows. In the week to October 13th, average daily flows fell to 11.62 million barrels from a baseline of 17.15 million barrels. Security risks in the Persian Gulf have contributed significantly to the price rally. Meanwhile, Ukrainian drone attacks on Russian refineries have further constrained fuel supply. Adding to the pressure, US crude inventories fell by 8.56 million barrels in the week ended October 9th.

Brent increased to 108.28 USD/Bbl, the highest since September 2026. Over the past 4 weeks, Brent Oil gained 3.22%, and in the last 12 months, it increased 76.52%.

Brent crude prices rose above $103 a barrel on Friday, heading for a weekly gain, as escalating Middle East tensions and supply disruptions outweighed plans to release emergency reserves. Concerns about restoring physical oil flows through the Persian Gulf intensified after US Central Command confirmed that the Singapore-flagged container ship GFS Pride sank while being towed to shore after an Iranian projectile struck it in the Strait of Hormuz. Nevertheless, more than 40 vessels transited the strategic waterway over the previous 24 hours, indicating that some traffic continues. Meanwhile, IEA members pledged to release the remaining 100 million barrels from an emergency intervention launched in March, following pressure from US officials. Separately, reports say Washington is considering easing sanctions on certain vessels carrying Iranian, Russian or Venezuelan oil.