Oil Prices Surge as Houthi Attacks Stoke Middle East Supply Fears

While Saudi authorities have yet to confirm damage at the 550,000-barrel-per-day Ras Tanura facility, the incident fueled a broader rally across energy markets. ICE Brent for December delivery gained $2.29 to settle at $116.17 per barrel, while refined products mirrored these gains, with November ULSD rising 7.21 cents to $4.8473 per gallon. Analysts at ANZ Research noted that despite recent discussions between Iran, Turkey, Pakistan, and Saudi Arabia, traders remain focused on the immediate threat to crude supplies.

The geopolitical risk premium is further compounded by reports of potential U.S. military maneuvers following the midterm elections and ongoing political deadlock in Israel. Citi Research warned that the instability in Israel could trigger renewed military escalations, complicating the path toward a negotiated agreement. Meanwhile, fundamental data reinforced the price support: the U.S. Energy Information Administration reported a fourth consecutive weekly decline in commercial crude inventories. Stocks dropped by 1.9 million barrels to 410.6 million, significantly outpacing the 100,000-barrel draw anticipated by market analysts.