Brent oil touches $110 as Iran escalates Hormuz attacks, Ukraine vows to hit Russian refineries

Brent and WTI prices jumped because attacks threatened several parts of the oil supply chain. Tankers were attacked in the Strait of Hormuz, Houthi missiles targeted Saudi Arabia, and Ukraine threatened more strikes on Russian refineries. Traders feared that less crude and fewer refined fuels could reach markets.

Brent futures briefly reached $110 per barrel, the first time since May, then eased to close at $109.86. That was a 3.7% daily gain. U.S. WTI rose 3.5% to $101.41. WTI gained more than 10% during the week, while Brent rose nearly 5%.

The price rise reflects immediate risk, not only confirmed supply losses. Hormuz shipments were already down to 9.4 million barrels per day, about 70% of their prewar average. Further attacks, refinery damage, or longer disruptions could push prices higher. A recovery in flows could reduce that risk premium.

The Strait of Hormuz is a narrow sea passage between Iran and Oman, connecting the Persian Gulf with the Gulf of Oman and the wider ocean. It is one of the world’s most important energy routes. The article calls it a waterway through which oil exports move, and reports attacks on at least nine ships there.

Its importance comes from concentration. Large volumes of crude and fuel leave Gulf producers through the same passage. If tankers are attacked, delayed, or forced to avoid the route, fewer barrels reach buyers. Insurance, freight, and security costs can also rise, adding pressure to prices even before a lasting shortage appears.

During this week’s attacks, shipments fell to 9.4 million barrels per day, about 70% of the prewar average. Continued disruption could tighten markets worldwide. However, the article does not detail every alternate route or the full share of global oil using Hormuz.

Before the attacks, the article describes crude exports through Hormuz as having returned to prewar levels in September. It does not give the exact normal daily figure directly. Instead, it says the latest flow was 9.4 million barrels per day and represented about 70% of the prewar average.

Using that percentage, the implied prewar average is roughly 13.4 million barrels per day. This is an estimate calculated from the article’s figures, not a separate number reported by Kpler. The latest data covered the week ending Wednesday and came from energy researcher Kpler.

The decline shows the attacks were already affecting movement through the waterway. A reduction of about 30% from the implied average means fewer barrels reached export markets. If disruptions persist or worsen, buyers may compete for alternative supplies, potentially lifting crude prices and transport costs.

Oil prices rise when buyers fear that supply will be interrupted. Tanker attacks can stop or delay cargoes. Port attacks can reduce loading and export capacity. Refinery strikes can cut the production of diesel and other finished fuels, even if crude remains available. Markets often price this risk before shortages fully appear.

The article gives several examples. At least nine ships were attacked in Hormuz, while a missile headed toward Saudi Arabia’s Yanbu oil export terminal. Ukraine also vowed to resume strikes on Russian refineries. The article links refinery attacks and Iranian strikes on Middle Eastern energy infrastructure to sharply higher diesel prices.

Diesel averaged $6.33 a gallon in the United States, more than 70% above the same period last year. Crude inventories also fell by more than 8 million barrels after Hurricane Isaias caused Gulf Coast production shut-ins. More damage or delays could raise prices further; restored flows and refinery operations could ease them.

The Houthis are a militant movement based in Yemen. In this article, they are described as Iran-allied militants. They attacked Saudi Arabian targets with missiles and drones, making their actions part of a wider regional threat to energy infrastructure and shipping.

Saudi Arabia said it intercepted missiles over the Red Sea, including one heading toward the Yanbu oil export terminal. Three drones were destroyed near Riyadh and in southern regions. The article also says an Aramco administrative building in Dhahran was hit Tuesday, while an earlier Riyadh airport attack killed 12 people and injured more than 300.

These attacks matter because Saudi Arabia is a major oil exporter and because threats near terminals can unsettle markets. The article establishes the Houthis’ connection to Iran, but it does not explain their specific motive for attacking Saudi targets. It also does not state that Iran directly ordered each Houthi attack.

If Hormuz remains restricted, countries can reduce the shock by using stored oil, alternative transport routes, and other suppliers. Strategic petroleum reserves can cover temporary shortages. Pipelines to ports outside the Strait can move some Gulf oil without using the waterway. Buyers can also seek crude from regions such as the Americas, Africa, or the North Sea.

For example, Saudi Arabia has an east-west pipeline to the Red Sea, and the United Arab Emirates has export facilities near Fujairah, outside Hormuz. These routes cannot necessarily handle every barrel normally shipped through the Strait. Reserves also release stored oil only for a limited period and may require government decisions.

The article reports that flows had already fallen to 9.4 million barrels per day, or about 70% of the prewar average. If restrictions continue, alternatives could slow the price impact but likely involve higher transport, quality, and security costs. The article does not identify any current substitute route being used.

Crude prices generally rise when demand exceeds available supply and fall when supply comfortably meets demand. Inventories act as a buffer. Large stocks can soften a temporary disruption, while low stocks leave buyers competing for fewer barrels. Finished fuels such as diesel also depend on refinery capacity, not just crude availability.

The article reports a decline of more than 8 million barrels in U.S. commercial crude inventories for the week ending October 9. Production shut-ins on the Gulf Coast after Hurricane Isaias contributed to that drop. At the same time, attacks threatened tankers, export terminals, and refineries. Those combined risks supported higher crude prices and diesel costs.

Diesel averaged $6.33 a gallon, more than 70% above the same period last year. If demand remains strong while supplies, inventories, or refinery capacity are constrained, prices can rise further. Restored production, safer shipping, higher inventories, or functioning refineries would reduce pressure.