Oil prices surge as Iran deploys new tactics to target tankers
USO•Oil prices rose after an attack on Saudi Aramco’s headquarters and Iranian officials said Iran had begun using new tactics to target ships. Brent gained 0.9% to $106.60 a barrel, while WTI rose 1.8% to $95.79, its highest in more than two weeks.
1. Oil prices climb
Brent crude futures rose 91 cents to $106.60 a barrel, while US West Texas Intermediate gained $1.65 to $95.79, a more than two-week high. Attacks on ships crossing the Strait of Hormuz and military strikes involving Saudi Arabia and the Houthis were supporting prices, UBS analyst Giovanni Staunovo said.
2. New tactics at sea
Iranian officials said Iran had started using different offensive tactics to target ships about 10 days ago, but declined to provide details. A container ship sank south of the Strait of Hormuz after hitting a naval mine and catching fire, Iran’s Revolutionary Guards Navy said. The United Kingdom Maritime Trade Operations had also reported that a container ship and a tanker were hit by unknown projectiles in the strait.
3. Diesel supply outlook
The Houthis attacked an administrative building belonging to Saudi Aramco in Dhahran, causing a limited fire, Saudi Arabia’s energy ministry said. The International Energy Agency said Russian crude production rose by 65,000 barrels per day in September to 8.43 million bpd, but remained 870,000 bpd below a year earlier. It said constrained diesel supplies could persist well into next year and that easing Russian diesel export restrictions was unlikely to materially change the global gasoil market balance.
