(Reuters) – Brent crude futures breached US$100 a barrel today for the first time since July 24 as escalating attacks in the Middle East, including on tankers, stifled hopes of a normalisation of oil shipping in the region.
The move brought futures prices into line with physical crude and fuel markets, where prices have already been trading above the psychological threshold.
Front-month Brent crude futures were up $2.74, or 2.8%, at $100.66 a barrel by 1315 GMT, after earlier touching $100.95. U.S. West Texas Intermediate crude was up $2.74, or 3%, at $95.77 a barrel, its highest level since early June.
The contracts were headed for their biggest daily rises in percentage terms since September 1.
Since the Iran war began on February 28, Brent has surged as high as $126.41 a barrel, a peak reached on April 30.
“The move towards and back above $100 Brent is reflecting a market that increasingly has to change its view on how long the Middle East crisis will continue to curb supply from the region,” said Ole Hansen, head of commodity strategy at Saxo Bank.
In a sharp escalation of the six-month-old war in recent days, U.S. forces hit multiple Iranian oil tankers and Iran targeted a U.S. base in Jordan and attacked ships.
A seafarer was killed in an incident involving the Gibraltar-flagged oil products tanker Hercules Star while at anchorage off Dubai, the vessel’s charterer Peninsula said on Wednesday.
This week, attacks by Iran-backed Houthis on Saudi energy facilities have also set oil installations ablaze, threatening a significant expansion of the conflict.
The attacks threaten crude shipments via the Red Sea, which has been a key alternative route to the crucial Strait of Hormuz, where oil flows have been severely curtailed.
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