DTN Oil Update
Brent Nears $100 on Middle East Escalation, Supply Risks
SECAUCUS, NJ (DTN) -- Oil prices hit multi-week highs Tuesday, with global crude benchmark Brent nearing the critical $100 bbl mark, after fresh Houthi attacks on Saudi energy facilities forced operations to shut down.
NYMEX WTI crude for October delivery rose $1.41, or 1.54%, to settle at $93.03 bbl, after hitting a 14-week high at $94.73.
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ICE Brent for November delivery closed up $0.92, or 0.95%, at $97.92 bbl. It ran up during the session to $99.46 bbl, its highest since a mid-July peak of $102.00.
Downstream, NYMEX ULSD for October delivery climbed $0.0244, or 0.61%, to finish at $4.5678 gallon. RBOB for October advanced $0.0376, or 1.17%, to end the session at $3.2525 gallon.
By 2:20 p.m. EDT, the U.S. Dollar Index slid 29.5 points to 98.855 against a basket of currencies.
The heightened rally in energy futures reflects intensifying fears over Middle East supply after U.S. forces targeted three Iranian tankers attempting to bypass export embargoes following strikes on American naval vessels. Tehran vowed swift military and economic retaliation, prompting Houthi strikes on Saudi refineries that further squeezed an already tight global middle distillate market.
Continuous Gulf export disruptions and persistently high input costs have kept crude prices elevated, while the U.S. faces limited policy tools to curb retail fuel pressure. Stockpiles in the Strategic Petroleum Reserve neared a 44-year low of 285.4 million bbl after a further decline of 1.2 million bbl last week, according to Department of Energy data on Tuesday that came ahead of weekly petroleum statistics due from the U.S. Energy Information Administration on Thursday.
The Organization of the Petroleum Exporting Countries is also scheduled to issue its monthly reading on oil supply-demand on Thursday, ahead of the International Energy Agency's market projections on Friday.
Diplomatic initiatives between the U.S. and Iran have stalled as Washington dismissed Tehran's demands for sanctions relief and recognition of its authority over the Strait of Hormuz as conditions for resuming formal negotiations.