Oil Prices Today: Brent crude oil prices climbed above $101 a barrel on Thursday, October 8, reversing the previous session's losses as fresh reports of potential US military action against Iran revived fears of further disruption to Middle East oil supplies.
Brent crude prices were last trading at $101.16 a barrel, up 0.96%, after settling at $100.20 in the previous session. The latest move came after reports that the Trump administration had instructed the Pentagon to develop strike options against Iran that could be carried out before the US midterm elections.
The development challenges the widely held expectation that US President Donald Trump would avoid a further escalation with Tehran ahead of the November polls.
Brent Crude Above $101: Iran Tensions Put Oil Markets On Edge
The prospect of potential US military action against Iran has added another layer of uncertainty to an already disrupted oil market.
Oil prices have also been supported by continued risks to supply routes in the Middle East. Attacks on tankers transiting the Strait of Hormuz have raised fresh concerns among traders over the security of one of the world's key oil shipping routes.
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At the same time, Iranian-backed Houthi militants have continued attacking targets in Saudi Arabia, prompting a fresh wave of strikes by the Riyadh-led coalition against positions in Yemen.
Gulf of Mexico Output Hit By Tropical Storm
Supply concerns are not limited to the Middle East.
Oil producers in the Gulf of Mexico shut in more than 510,000 barrels per day of crude oil output, equivalent to around a quarter of the region's production, due to Tropical Storm Isaias.
The production disruption comes as oil markets remain sensitive to any additional supply shock amid ongoing geopolitical tensions.
Middle East Oil Exports Gradually Recover
Meanwhile, oil exports from the Middle East have been gradually returning towards prewar levels in recent weeks.
Oil pumped through Saudi Arabia's East-West pipeline had reached 5.8 million barrels as of Tuesday morning, according to Saudi Energy Minister Prince Abdulaziz bin Salman. The pipeline had been closed in early September after sustaining damage in a drone attack.
However, the recovery in exports remains vulnerable to renewed attacks.
Saudi Arabia's aviation authority reportedly said on Tuesday that airports in Jazan and Najran were targeted in two attacks as fighting between the Houthis and Saudi Arabia escalated.
Iran's decision to step up attacks on oil tankers transiting the Strait of Hormuz has also renewed concerns over the stability of oil supplies.
IEA Diesel Stock Release Weighs On Oil Prices
The latest rise in Brent comes a day after crude prices fell following a decision by International Energy Agency member states to prioritise the release of diesel stocks to address surging fuel prices.
Brent crude futures fell 38 cents to settle at $100.20 a barrel on Wednesday, while US West Texas Intermediate futures declined $1.16 to settle at $88.28 per barrel.
IEA members agreed to support the prioritisation of diesel stock releases, to the extent possible, given tightness in diesel markets, according to IEA Director Fatih Birol.
IEA member states have already deployed around 325 million barrels of oil under the March emergency action plan aimed at addressing supply disruptions triggered by the Iran war, Birol said.
That leaves around 100 million barrels yet to be released under the March plan.
The IEA said member states still hold emergency stocks equivalent to 1.1 billion barrels, including more than 200 million barrels of diesel, and remain ready to release more stocks if required.
G7, IEA Oil Stock Releases In Focus
The IEA meeting and subsequent statement came after G7 nations agreed on Friday to release diesel stocks amid pressure from the Trump administration.
However, the exact volume of diesel that will ultimately be deployed remains unclear.
With supply disruptions, attacks on key energy infrastructure and heightened tensions around Iran and the Strait of Hormuz all unfolding simultaneously, the oil market remains highly sensitive to fresh geopolitical developments.
For now, Brent crude above $101 a barrel reflects renewed risk premium in oil prices even as efforts to release emergency fuel stocks and restore Middle East exports continue.
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