Oil markets experienced a choppy trading day as prices slipped from intraday peaks reached earlier in the session while traders assessed claims of attacks on Saudi targets and reports of incidents involving vessels in the Gulf. The volatility underscored persistent concerns about energy supply security from the Middle East and the impact of shipping disruptions on global flows.
Yemen’s Iran-aligned Houthi movement said it launched multiple strikes on Saudi energy, airport and military targets on Monday, naming an Aramco site in Yanbu, the Shaybah oilfield, Riyadh’s King Khalid International Airport and Abha airport among the targets. Saudi authorities did not immediately confirm the Houthi claims, and the reported incidents could not be independently verified.
Brent crude futures fell 67 cents, or 0.61%, to $108.88 at 10:09 a.m. EDT after earlier climbing to $111.99, a five-month high. The November contract for U.S. West Texas Intermediate (WTI), which expires on Tuesday, was up 88 cents, or 0.85%, at $104.54 after trading as high as $110.48 earlier in the session - the highest level since April for a nearby contract. The more actively traded December WTI contract was down 45 cents, or 0.46%, at $98.09 a barrel.
Analysts at ING said the market remained well supported and that current pricing suggested a significant risk premium given the ongoing volatility. Market participants have been keeping that premium in place as incidents affecting vessels continue to be reported.
Shiptracker Kpler reported that at least 18 vessels had been attacked over a recent two-week span, a statistic that market watchers say helps explain the sustained risk premium on oil and freight markets. In a separate development linked to the broader security situation, a Houthi strike on a training camp for government security forces in Yemen’s Shabwa province killed 58 people and injured more than 200, events that further heightened concerns about regional stability and potential knock-on effects for energy supply.
On the fuel supply front, Russian diesel cargoes are moving back toward their traditional destinations following a temporary pause in sanctions and the lifting of an export ban, with shipping data from Kpler and LSEG showing at least two tankers signaling voyages to Turkey and Brazil in recent days. That flow shift comes as U.S. officials are also seeking to increase crude processing at domestic refineries.
U.S. Energy Department Under Secretary Kyle Haustveit said on Tuesday at the Drake Forum in Titusville, Pennsylvania, that the United States is working with domestic refiners to push more crude through the refining complex. Separately, analysts expected crude oil stockpiles to have fallen last week along with product inventories, according to a preliminary poll published on Monday.
Market takeaway
- Despite a midday retreat, oil benchmarks showed intraday strength with Brent touching a five-month high and nearby WTI contracts reaching their highest levels since April.
- Claimed strikes on Saudi energy and airport infrastructure and reported vessel attacks continue to underpin a risk premium in prices.
- Shifts in diesel trade flows and U.S. efforts to boost refinery throughput are important supply-side dynamics to monitor.
The combination of geopolitical friction, reported attacks on shipping, and movements in refined product flows leaves energy markets sensitive to further developments. Traders and logistics operators remain focused on whether reported incidents are confirmed and how sustained shifts in cargo routing could affect regional and global fuel balances.