Oil prices ended Wednesday’s session sharply higher, with Brent futures rising $3.29, or 3.36%, to settle at $101.21 a barrel, moving above $100 for the first time since late July amid intensifying attacks on oil tankers and declining flows through the Strait of Hormuz.
Brent touched $101.55 during the session, while U.S. West Texas Intermediate crude rose $3.02, or 3.25%, to $96.05. Both benchmarks posted their highest closes since May 22, while Brent recorded its biggest daily percentage gain since early September.
Attacks on oil tankers
Prices surged after Iran said it had attacked 10 vessels near the Strait of Hormuz, while U.S. Central Command said its forces had destroyed 5 Iranian oil tankers in the Gulf of Oman and near Kharg Island on September 8, in one of the largest waves of attacks on shipping since the war began more than 6 months ago.
U.S. Central Command said the strikes followed two Iranian attempts over two days to target a U.S. warship with ballistic missiles, and that tanker crews had been ordered to leave before the vessels were bombed. U.S. forces had destroyed 3 other Iranian tankers on September 5.
Saxo Bank’s head of commodity strategy, Ole Hansen, said Brent’s return above $100 reflected the market’s need to reassess the duration of the Middle East crisis and its ability to keep regional supplies constrained, after traders had previously bet that the war would remain limited.
Brent reached a peak of $126.41 on April 30, after the war on Iran broke out on February 28, before falling below $100 in late May. It did not move above that level again except briefly in late July.
Hormuz flows below pre-war levels
The International Energy Agency estimated that oil flows through the Strait of Hormuz had fallen from around 20 million barrels per day before the conflict to an average of 2.7 million barrels per day during March, April and May.
Kpler data showed that 6 cargo-laden vessels passed through the strait on Tuesday, compared with 9 the previous day and an average of about 12 vessels per day over the preceding 10 days.
Rystad Energy’s chief economist, Claudio Galimberti, said oil flows through the strait had recovered to between 8 million and 9 million barrels per day during the week before fighting resumed on August 30, before recently falling to less than 2 million barrels per day.
The United Kingdom Maritime Trade Operations agency issued a warning that a tanker had been hit by an unidentified projectile 28 nautical miles southeast of Iraq’s al-Faw, saying the crew was safe and that no environmental damage had been reported at the time of the alert. It also received a separate report that a vessel anchored 24 nautical miles northwest of the UAE’s Port Rashid was listing, possibly after taking on water when it was hit by an unidentified projectile.
Traders fear that ship-to-ship oil transfers in the Gulf of Oman could decline after those operations helped deliver Gulf crude to markets and limit price increases since regular traffic through Hormuz was disrupted. Risks increased after Houthi attacks on energy facilities in Saudi Arabia, as the conflict’s spread to the Red Sea threatens an alternative route the kingdom had used to increase exports from the port of Yanbu and bypass restrictions on passage through the strait.
Fuel prices outpace futures
Physical oil and refined-fuel prices moved above $100 before futures did, as spot markets responded more quickly to supply shortages and buyers were forced to pay higher premiums to secure alternative cargoes.
The latest data from the U.S. Energy Information Administration showed that the average price of regular gasoline in the United States reached $4.16 a gallon in the week ended September 7, while diesel hit a record $5.97 a gallon. In Europe, diesel futures approached $200 a barrel amid shortages of refined products and disrupted supplies from the Gulf and Russia.
Brent forecast at $90
The U.S. Energy Information Administration said in a report issued today that global oil inventories had fallen by about 400 million barrels since the beginning of 2026, and forecast that they would continue to decline through the end of the year, keeping prices elevated in the coming months.
The agency forecast that Brent would average about $90 in the second half of the year, but the report’s estimates were finalized on September 3, before the latest wave of attacks pushed crude above $101 at settlement.
The agency assumed that restrictions on Middle East exports would remain in place through the end of 2026 and that regional output would stay below pre-war averages through the second quarter of 2027, before a recovery in supplies and inventories allowed average Brent prices to fall to $74 next year.
