Oil climbs to $110 as missiles target Saudi oil facilities
Brent settled at $109.86 on Friday, its highest since May. U.S. crude is also back above $100. Saudi Arabia reports intercepting missiles, including some aimed at the oil port of Yanbu.
Graphic: TERRA WORLD NEWS (own graphic based on the sources listed)
The escalation in the Middle East has driven oil prices back to $110. North Sea Brent for December delivery settled up 3.72% at $109.86 a barrel on Friday after reaching $110 during the session for the first time in five months, the Bulgarian business portal Banker.bg reported. U.S. benchmark WTI rose 3.61% to $101.41, settling above $100 for the first time in about a month.
The trigger was reports from the Saudi-led coalition that it had intercepted ballistic missiles aimed at key energy facilities in the kingdom, including the refining and export hub of Yanbu on the Red Sea. Because tankers are being attacked in the Strait of Hormuz, Saudi Arabia is routing much of its crude via the East-West Pipeline to Yanbu. That makes the city a vulnerable target, said analyst Shrainer Parker of Rystad Energy. Helima Croft of RBC Capital Markets said the Houthi attacks showed the situation was far from normal.
At the same time, Ukraine again attacked Russian refineries; according to Reuters, a distillation unit in Ryazan was knocked out. Emergency reserves are meant to counter the pressure: the International Energy Agency agreed on Oct. 15 to release more than 20 million barrels, and the U.S. Department of Energy is offering up to 17 million barrels from the strategic reserve in exchange deals. According to analytics firm Kpler, oil flows from the Gulf have fallen sharply, and a recovery will be slow without a political settlement.