Oil Prices Surge Past $116 Amid Middle East Tensions

Darwin, October 25: Global oil prices surged by more than $3 a barrel to above $116, reaching their highest level in six months, amid concerns over potential disruptions to energy supplies from the Middle East. The rise was recorded at the close of trading on Friday, October 23, following reports of Houthi attacks in Saudi Arabia and an oil spill off the coast of the United Arab Emirates (UAE).

According to Reuters, Brent crude rose by $3.55, or 3.14%, to settle at $116.72 a barrel on Friday. This marked its highest price since April 29. US West Texas Intermediate (WTI) crude increased by $3.80, or 3.8%, to $103.27 a barrel.

Over the week, Brent crude gained 6%, while WTI rose by 2.3%.

Adam Turnquist, chief technical strategist at LPL Financial, said concerns about supply disruptions had intensified following attacks by Iran-backed Houthi rebels on Saudi Arabia, including strikes targeting energy infrastructure and other locations. These developments have contributed to the rise in oil prices, as traders assess the potential impact on regional supplies.

Meanwhile, the UAE’s Ministry of Climate Change and Environment reported an oil spill off the coast of Umm Al Quwain. Authorities have yet to determine the cause of the spill or identify the vessel responsible.

Shipping industry sources also reported that an oil tanker named Gem No. 2 was damaged on October 9 after an unidentified object struck it west of the Al Jazirah area in the UAE.

The combination of security concerns, reported attacks on energy infrastructure and uncertainty surrounding maritime incidents has heightened market concerns about the reliability of oil supplies from the Middle East. Traders are closely monitoring developments in the region for signs of further disruption that could affect global crude prices.