Global oil prices have reached a five-month high amid escalating tensions in the Gulf region, sparking concerns over potential disruptions to crude oil supplies. On Thursday, Brent crude surged 3%, hitting $112 per barrel, the highest since mid-May, following a series of attacks and incidents involving vessels near the Strait of Hormuz.
The increase in oil prices follows attacks carried out by Yemen’s Houthi movement in Saudi Arabia, resulting in four deaths and eight injuries. Among the affected locations were a civilian airport in Dammam and an oilfield, which was targeted by a drone. Meanwhile, Iran’s Islamic Revolutionary Guard Corps reported striking four vessels in the northern Gulf, accusing them of illegal oil transfers, and warned of further action against US regional bases if provocations continue.
The situation has revived fears over the security of the Strait of Hormuz, a critical energy shipping route. Past disruptions in this area had previously driven oil prices to $126 per barrel in April, though prices later dropped amid hopes for a ceasefire. While oil exports from the Persian Gulf have bounced back to levels above those seen before the conflict, increased pipeline shipments to the Red Sea and Gulf of Oman have partially mitigated shipping disruptions. However, the latest attacks have cast doubt on the stability of global oil supplies.
The rise in oil prices is also impacting financial markets, with major European and Asian stock indices declining on Thursday. Rising energy costs are fueling concerns about inflation and may keep borrowing costs elevated. The economic ripple effects are evident, as demonstrated by American Airlines’ warning that high fuel expenses could lead to a loss this year.