Oil gains as traders weigh Gulf tensions against strong Mideast exports
USO•Brent crude rose 0.3% to $100.59 a barrel and U.S. West Texas Intermediate gained 0.3% to $89.73 as Middle East security concerns offset resilient regional exports and plans for a G7 emergency stockpile release.
1. Oil prices edge higher
Brent crude futures rose 27 cents, or 0.3%, to $100.59 a barrel, while U.S. West Texas Intermediate crude futures gained 30 cents, or 0.3%, to $89.73. Security concerns in the Middle East supported prices, while resilient regional exports and the planned release of emergency stocks eased supply concerns.
2. Exports and supply risks
Gulf oil flows excluding Iran exceeded 81% of pre-war levels in September, led by recovering Saudi exports; Iranian exports fell to zero due to a U.S. blockade. A G7 agreement provides for releasing 100 million barrels of diesel and crude from emergency reserves, while tanker attacks around the Strait of Hormuz and conflict involving Saudi Arabia and Iran-backed Houthi forces continued to raise concerns about disruption.
3. Shipping costs rise
Gulf-to-Asia shipping rates reached new record highs, while low oil inventories also made market participants reluctant to believe lower prices could be sustained. Houthi claims of attacks on locations in Saudi Arabia, including an Aramco refinery in Rabigh, could not be immediately verified.
