Continued Vessel Targeting in Region Escalates Global Oil Supply Concerns
Oil prices rose on Monday amidst concerns of a prolonged disruption in Middle East supplies. This surge stems from reciprocal attacks between the United States and Iran targeting ships in the Strait of Hormuz and other areas. Brent crude futures increased by 77 cents to $97.05 per barrel, while U.S. West Texas Intermediate (WTI) crude climbed 79 cents to $92.27 per barrel by 04:12 GMT. This increase follows last week's gains, with Brent crude rising 7.8% and WTI gaining approximately 10%. The renewed attacks are attributed to a reduction in oil flows through the Strait of Hormuz, the vital passage for one-fifth of global oil supplies before the conflict. The U.S. Central Command reported on Saturday that its forces targeted three Iranian oil tankers, one off Kharg Island near Iran's main oil export center. Conversely, Iran's Revolutionary Guard Corps (IRGC) Navy announced it targeted three oil tankers traversing unauthorized routes in the Strait of Hormuz, in addition to three U.S. vessels in different areas. Marisecs, a specialized maritime intelligence firm, described Saturday's attacks as a "significant escalation in the maritime conflict." It added: "Commercial tankers are now deliberately being used as tools of mutual economic pressure, significantly weakening the previous distinction between military confrontation and commercial shipping." Data released by Kpler on Monday showed the daily average for commodity vessel transits through the Strait of Hormuz stood at 10 ships over the past ten days, marking the lowest level since May. In a separate development, the OPEC+ alliance decided to maintain its oil production policy unchanged for October, following a meeting held last Sunday. Analysts at ANZ Bank predicted that the most likely scenario is a prolonged confrontation with calculated military actions, which would delay a full recovery of Middle East supplies. They stated, "Exports are expected to remain constrained through the remainder of 2026, before a gradual reopening in late Q4 2026," with pre-war flow levels not anticipated to return until late Q1 or early Q2 2027.
