Oil hits five-month high amid fears US will renew strikes on Iran

Oil prices rise when traders fear future supplies may be interrupted. That is what happened here. Markets were already watching an eight-month Iran war, and fresh warnings suggested the conflict could spread to energy infrastructure and shipping routes. Brent crude rose 1% to $114.72, its highest level since May.

Iran said it would strike Gulf oil facilities, undersea cables, datacentres and AI facilities if the United States and Israel launched a new attack. The Islamic Revolutionary Guards Corps also claimed strikes on four commercial ships in the Strait of Hormuz. Houthi rebels continued attacking Saudi facilities, while ships faced projectiles near the strait.

Investors also feared possible renewed US-Israeli strikes after the US midterm elections. Ukraine's attacks on Russian diesel refineries added another supply concern. Together, these threats encouraged traders to price in a greater chance of shortages, pushing oil higher even before an actual global shortage occurred.

Brent crude is a grade of crude oil used as a reference price in international markets. The article calls it the international benchmark and reports its price at $114.72 a barrel. That means Brent's quoted price is used to compare, price or settle many oil transactions, rather than describing every barrel produced worldwide.

Its benchmark role comes from broad trading and market visibility. Buyers and sellers can use one commonly watched price when negotiating contracts or judging whether oil is becoming more or less expensive. The article does not explain Brent's composition or trading system, but it clearly uses Brent to measure the market's reaction to Middle East risks.

This matters because a change in Brent quickly becomes a signal for energy companies, investors and governments. Here, the 1% rise showed that traders viewed threats to Gulf infrastructure, ships and possible Iran strikes as important international supply risks.

The movement has been large and rapid. Oil was about $72 a barrel in February, then reached $126 by the end of April. By Friday morning, Brent stood at $114.72. These figures show that prices remain far above their pre-war level, even though they are below the April high.

From $72 to $114.72, the increase is $42.72 per barrel, or about 59%. From February to the April peak of $126, the increase was $54, or 75%. The current price is $11.28 below April's peak, a fall of about 9% from that high. The February figure is approximate, so the percentage comparisons are also approximate.

The pattern reflects changing expectations about supply risk. Prices surged as the Iran war began, then climbed further as concerns grew about facilities, refineries and shipping routes. The latest rise suggests traders again see a serious chance of disruption, rather than treating the conflict as brief.

The article identifies several countries and armed groups connected with supply threats. Iran threatened Gulf oil facilities and other infrastructure if attacked by the United States and Israel. The Islamic Revolutionary Guards Corps, Iran's military force, claimed it had struck four commercial ships in the Strait of Hormuz.

Houthi rebels in Yemen continued attacking Saudi Arabia's facilities, while ships crossing the strait faced fired projectiles. The article also says Ukraine bombarded Russian diesel refineries. These actions affect either production facilities, refining capacity or the transport routes needed to move energy to buyers.

The United States and Israel are not reported to have launched the possible new strikes in this passage. Instead, markets feared they could do so after the US elections. Saudi Arabia and Russia are targets of reported attacks, while Iran, the Houthis and Ukraine are the actors linked to the attacks or threats described. The combined uncertainty is what raises supply concern.

The Strait of Hormuz is a narrow maritime passage linking the Persian Gulf with the Gulf of Oman and the wider ocean. Oil tankers use it to carry energy exports from Gulf producers to international buyers. The source does not provide its geography or shipment volumes, but it describes the route as dangerous and important to oil markets.

Its key mechanism is concentration. When many cargoes depend on one passage, threats to ships or the waterway can affect expected deliveries. The Islamic Revolutionary Guards Corps claimed to have struck four commercial ships, and Susannah Streeter said projectiles were still being fired at ships attempting to cross. That increases the risk of delay, damage or rerouting.

Even without a confirmed closure, traders may raise prices because they cannot be sure shipments will arrive normally. The article links the danger in Hormuz with wider supply fears. If attacks intensified, buyers and insurers would likely face greater costs, while markets would price in a higher risk of disruption.

If Hormuz became more dangerous, oil buyers would try to reduce reliance on that passage. They could purchase more crude from producers outside the Gulf, use pipeline exports that reach ports without crossing the strait, or draw on government and commercial inventories. These are established energy-market responses, but the article does not identify specific alternatives.

Some Gulf exports can move through pipelines to ports on the Red Sea or the Gulf of Oman. Tankers could also take longer routes where suitable, though that would add time, fuel and insurance costs. Refineries might switch to other crude grades, but technical limits mean not every oil can be replaced immediately.

The main constraint is scale. Alternative pipelines, ports, reserves and non-Gulf producers may not handle all displaced shipments at once. Buyers would therefore compete for available barrels, pushing prices higher. If the danger lasted, markets could adjust, but the transition would remain costly and potentially disruptive.

Oil is traded in a connected global market, so threats to a small number of facilities can affect prices far beyond the immediate area. Traders do not wait for every barrel to disappear. They estimate how much supply might be lost, how quickly it could return and whether transport could also be disrupted. Greater uncertainty usually adds a risk premium to prices.

For example, an attack on a refinery can reduce fuel production, while an attack on an export terminal or tanker route can prevent crude from reaching buyers. The article combines threats to Gulf oil facilities, commercial ships and the Strait of Hormuz with Ukraine's bombardment of Russian diesel refineries. Each threat targets a different part of the supply chain.

Higher prices encourage sellers to release barrels and buyers to conserve or find alternatives, but those changes take time. Until traders understand the damage and available substitutes, they may pay more now to secure future supplies. That is why fear alone can move Brent sharply.