- Brent crude hits a near two-week high as attacks on Saudi Arabia raise supply concerns.
- Tanker incidents near the Strait of Hormuz threaten Middle East oil exports.
- Planned Russian diesel supplies and a Russia-Ukraine energy ceasefire offer some relief to markets.
Oil prices rose on Monday, October 12, as attacks on Saudi Arabia raised concerns about global oil supplies. The attacks overshadowed plans for additional Russian diesel supplies and a Russia-Ukraine energy ceasefire announced by US President Donald Trump.
Brent crude futures rose by $1.24, or 1.2%, to $106.19 a barrel by 1124 GMT. This was their highest level since September 29. US West Texas Intermediate (WTI) crude gained $1.11, or 1.2%, to $92.96 a barrel.
Saudi Attacks Raise Oil Supply Concerns
The Iran-aligned Houthis claimed responsibility for a Saturday attack on Riyadh’s international airport. The strike reportedly killed 13 people and injured more than 300. Further attacks were reported on Sunday.
The attacks have raised concerns about the safety of energy facilities and shipping routes across the region.
Two tanker incidents were also reported near the Strait of Hormuz. The United Kingdom Maritime Trade Operations (UKMTO) reported that a drone struck one tanker near Sohar, Oman. Another vessel was damaged while passing through the Strait.
The incidents could slow the recovery in Middle East oil exports recorded in September. They have also raised fresh concerns about shipments through a major global oil route.
“The sense of some kind of normality of exports from the Strait of Hormuz was shattered last week,” said Bjarne Schieldrop, a commodities analyst at SEB, a Nordic financial services group.
He added that the latest Houthi attacks on Saudi Arabia had helped push oil prices higher.
Schieldrop said authorities could face difficult choices over which sites to protect. These include oil facilities, military bases, royal palaces and civilian airports.
Goldman Sachs Raises Oil Price Forecast
Goldman Sachs raised its December Brent crude price forecast to $90 a barrel from $85. The bank estimated that supply risks had added just over $20 to oil prices.
It expects WTI to average $81 a barrel in December 2026 and $73 in 2027. High shipping costs between the United States and Europe have kept WTI prices unusually low compared with Brent.
Meanwhile, Shell, Chevron and BP were working to restore production at their Gulf of Mexico platforms. Hurricane Isaias made landfall early on Saturday, prompting efforts to redeploy personnel.
Russian Diesel Supplies Could Ease Market Pressure
While crude prices rose, ICE gasoil futures fell 2.3% to $1,449 per metric tonne.
The decline followed Trump’s announcement on Friday that Russia would immediately supply more than 300,000 metric tonnes of diesel. The fuel would go to US and global markets, with more supplies expected later.
However, analysts questioned how quickly the additional fuel could reach the market. Russia’s refining capacity has suffered significant damage.
“The immediate impact of the deal is questionable, as Russia’s refining capacity has been severely reduced,” said Tamas Varga, an analyst at PVM Oil Associates.
Varga said Russia had partly lifted its diesel export ban. This could release 500,000 tonnes, or about 3.7 million barrels, onto the international market.
He estimated that volume equalled roughly one day of US diesel consumption and about 13% of global demand.
Russia-Ukraine Energy Ceasefire Faces Uncertainty
Trump announced on Sunday that Russia and Ukraine had agreed to an energy ceasefire. Ukrainian President Volodymyr Zelenskiy accused Russia of violating the ceasefire on Monday. Russia had not commented at the time of the report.
International Energy Agency Executive Director Fatih Birol urged member countries to assess whether more diesel supplies were needed. He also called on countries to speed up previously pledged releases, with diesel given priority.