Oil prices advanced for a fifth consecutive session on Thursday after Houthi forces claimed attacks on two Saudi oil tankers in the Red Sea, intensifying concerns over the security of key global energy shipping routes and lifting Brent crude above $97 a barrel.
Brent crude futures for September delivery rose 3.6% to $97.45 per barrel, while West Texas Intermediate (WTI) futures gained 2.7% to $89.17 per barrel.
Brent reached its highest level since early June, recovering all of the losses recorded after the temporary U.S.-Iran ceasefire.
Red Sea attacks increase supply concerns
The Houthi movement said it had targeted the Saudi tankers ENCELA and LAYLIA, accusing the vessels of breaching a recently announced maritime blockade.
Saudi authorities have not confirmed any damage, but the latest incident adds to growing concerns that the conflict is threatening critical energy infrastructure and international shipping lanes.
Earlier this week, the Houthis warned they would seek to block Saudi-linked vessels passing through the Bab el-Mandeb Strait, one of the world’s most important maritime routes for crude oil exports.
A prolonged disruption could force ships to divert around the Cape of Good Hope, increasing transit times and transportation costs.
Strait of Hormuz tensions remain elevated
Markets were also monitoring developments around the Strait of Hormuz after U.S. forces carried out another round of strikes against Iran, marking a twelfth consecutive night of military action.
Iran’s Revolutionary Guards reported an explosion along a mined shipping corridor south of the Strait of Hormuz, stating that one of three oil tankers caught fire while the remaining vessels turned back.
Iranian officials reiterated that they had full control of the Strait of Hormuz, stating that the waterway was “fully closed” and warning that oil tankers would not be allowed to pass without prior coordination with Iranian authorities.
Together, the Strait of Hormuz and the Bab el-Mandeb Strait account for a significant share of global seaborne crude exports, making any disruption closely watched by energy markets.
Inventory build offsets some supply concerns
Despite geopolitical tensions, fresh U.S. inventory data pointed to a larger-than-expected increase in crude oil stockpiles.
The U.S. Energy Information Administration reported that commercial crude inventories increased by 2.0 million barrels to 411.7 million barrels during the week ended 17 July, defying expectations for a decline.
Gasoline inventories rose by 0.8 million barrels, distillate stocks increased by 1.4 million barrels and total commercial petroleum inventories climbed by 11.6 million barrels.