Oil Hovers at Over 4-Month Highs

Crude oil held above $105 per barrel on Wednesday, remaining near its highest levels in over four months amid broadening supply disruptions in the Middle East. Saudi Arabia reportedly cancelled some shipments after drone attacks forced the closure of the East-West pipeline, notifying European customers that several September deliveries had been scrapped. There is still no clear timeline for when operations at the key pipeline, which provides an alternative route around the Strait of Hormuz, will resume, as Iran-backed Houthi militants renewed attacks on Saudi Arabia this week. In Libya, the national oil company also suspended operations at two oilfields and a pumping station amid ongoing protests. Beyond the Middle East, Russia struck petrol stations in Kyiv, while Ukraine targeted a Russian oil refinery, despite US President Trump’s announcement that both sides had agreed to halt attacks on each other’s energy infrastructure.

Crude oil rose past $105.5 a barrel on Tuesday, its highest level in four months, after Saudi Arabia reportedly cancelled some shipments following drone attacks that forced the closure of its key export pipeline. Saudi Arabia reportedly informed European customers that some September deliveries were cancelled, while oil loadings at Yanbu were suspended. Meanwhile, Iran-backed Houthi militants renewed strikes on Saudi Arabia this week. Security in the Strait of Hormuz remains volatile, with at least two tankers attacked since Saturday. Commodity vessel traffic through the strait fell to four on Monday from 10 a day earlier, Kpler data showed. In Libya, the national oil company suspended operations at two oilfields and a pumping station amid protests. Russia also struck petrol stations in Kyiv and Ukraine targeted a Russian oil refinery, despite US President Trump’s announcement that both sides had agreed to halt attacks on each other’s energy infrastructure.

Crude oil rose past $105 per barrel on Tuesday, the highest in over four months, on mounting curbs to supply from the Middle East and fresh setbacks on Libyan output. Saudi Arabia closed its East-West pipeline following attacks from Iraqi territory. The strikes suspended activity in infrastructure that was allocating 7 million barrels per day of Saudi oil to the Red Sea, an alternative to halted shipments through the Persian Gulf due to the Iranian blockade on tankers. The prolonged halt of tanker flows from the region forced major OPEC members to cut oil production, with Saudi output recently dropping to its lowest since 1990. Meanwhile, Libya suspended activity in several oil fields and warned it could declare force majeure as protests by the Petroleum Facilities Guard shut off the Hamada-Zawiya crude-loading pipeline. Dwindling stockpiles of oil in China drove the major importer to raise orders in August, while the US SPR stands at a near record low.