By Paul Burkhardt, Bingyan Wang and Alex Longley.
Brent oil approached $100 a barrel after Saudi Arabia said operations at several energy facilities in the kingdom’s south were halted by attacks.
The global benchmark was less than $1 away from triple figures after rallying last week on a flare-up in Middle East hostilities and a pick-up in buying by China, the world’s largest importer.
The state-run Saudi Press Agency said the strikes took place Tuesday and wounded a number of people. Iran-backed Houthi militants said they again targeted the kingdom’s 400 000 barrel-a-day Jazan refinery and facilities that serve the domestic market. The Houthis are blockading Saudi Arabia’s oil flows in response to Riydah’s siege of the Yemeni capital, Sana’a, and have made repeated strikes in recent weeks.
The campaign against the largest producer in the Organisation of the Petroleum Exporting Countries adds to concerns that oil supplies will continue to face disruption as a result of both Houthi attacks and the Iran war. Global inventories have been declining at a rapid pace, and prices for refined fuels like diesel are soaring around the world.
Brent oil is up more than 60% so far this year, while Europe’s diesel benchmark is closing in on $200 a barrel.
“Markets are increasingly pricing a prolonged Mideast conflict,” Goldman Sachs Group analysts including Daan Struyven said in a note, modestly raising the bank’s oil-price estimates on the assumption that shipping disruptions will persist into 2027. “Risks to our price forecast remain significantly tilted to the upside.”
As well as tensions in the Middle East, oil traders are increasingly honed on the outlook for refined fuels.
Russell Hardy, the boss of leading trader Vitol Group, said at a conference in Singapore on Tuesday that those markets are increasingly flashing signs of tightness. That’s in part because of the loss of about 2 million barrels a day of exports from the Middle East, and a further 2 million from Russia as a result of Ukraine’s drone attacks, he said.
Hardy estimated that oil flows through Hormuz are about 10 million barrels a day, about half of pre-war levels, but added that an exact figure is hard to quantify and volumes aren’t guaranteed to leave every day.
On the Strait of Hormuz, Iran said on Monday that an accord is imminent with Oman that will include a temporary safe passage route, raising questions about how the US would respond after striking Iranian tankers over the weekend. Tehran also warned that ships face the risk of attack near Oman on a route that the US has been using to help vessels cross the waterway.
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Chinese crude imports strengthened in August, as cargoes from the Persian Gulf crept higher and refiners increased purchases from other sources, according to customs data on Tuesday. Higher purchases have allowed the nation to export more oil products, offering some relief to global markets.
Following the recent flare-up in hostilities, Iranian official Mohsen Rezaee said the “operational posture toward US warships and bases has been fundamentally recalibrated.” The US has been given “clear warning” about Iran’s missiles in recent days, the senior security official said in a post on X.
“We’ve seen so many twists and turns since late February, and every time we thought we were going to get somewhere, it has been ripped apart,” said Chris Weston, head of research at Pepperstone Group. “We’re back to almost square one.”
© 2026 Bloomberg.