Oil prices moved higher on Wednesday as investors focused on potential supply disruptions in the Middle East and weather-related risks to U.S. production.
Crude extended Tuesday’s gains as renewed fighting in Yemen increased concerns about regional energy supplies.
At the same time, the Atlantic hurricane season raised the risk of production outages in the Gulf of Mexico.
Brent and WTI Crude Oil Prices Move Higher
Brent crude futures rose 0.77% to $101.36 per barrel.
West Texas Intermediate crude futures gained 0.89% to $90.25 per barrel.
The advance reflected growing concern that geopolitical tensions and severe weather could tighten global oil supplies.
However, reports of improving Middle East oil flows limited the size of the gains.
Planned emergency supply releases from the Group of Seven also helped ease some pressure on the market.
Middle East Supply Risks Remain in Focus
Iran has reportedly increased the pace of attacks around the Strait of Hormuz in recent days.
The rise in activity comes as Gulf producers have been working to restore oil shipments toward levels seen before the conflict.
Shipping data showed that crude flows through the Strait of Hormuz and the wider Middle East had improved significantly over recent weeks.
U.S. naval protection in the region has also supported the recovery in shipments.
Despite that progress, the security situation remains fragile.
Strait of Hormuz Attacks Raise Fresh Concerns
The UK Maritime Trade Operations reported seven strikes on vessels around the Strait of Hormuz since late September.
One of the latest incidents occurred as recently as Sunday.
The Strait of Hormuz remains one of the world’s most important oil shipping routes. Any major disruption could therefore have a significant impact on global crude supplies and oil prices.
Yemen Conflict Adds to Oil Market Uncertainty
Tensions in Yemen also contributed to stronger crude prices.
The Saudi-backed Yemeni government reportedly regained several strategic positions along the Red Sea from Iran-backed Houthi forces.
If those gains are sustained, they could eventually improve the security of oil shipments through the Bab el-Mandeb Strait.
However, the Houthis responded with attacks on targets in Saudi Arabia.
Reports of an attack on a major Aramco refinery in Riyadh added to concerns about regional energy infrastructure and helped push oil prices higher.
Gulf of Mexico Storm Threatens U.S. Oil Production
Energy markets are also watching the Gulf of Mexico as a tropical disturbance develops.
Weather forecasters warned that the system could strengthen into a storm by Friday.
The storm could disrupt offshore oil production in the region.
Chevron and Shell were reportedly evacuating non-essential personnel from some offshore facilities as a precaution.
Any extended shutdowns could tighten U.S. supply and provide further support for crude oil prices.
U.S. Oil Inventories Fall After Three Weeks of Builds
U.S. crude oil inventories also declined last week.
Data from the American Petroleum Institute showed that inventories fell by 2.09 million barrels in the week ending October 2.
The decline followed three consecutive weeks of sizeable inventory increases.
The draw comes as U.S. producers prepare for possible weather-related disruptions in the Gulf of Mexico.
Official U.S. Inventory Data in Focus
Markets are now waiting for official U.S. oil inventory figures due later on Wednesday.
API data often provides an early indication of the trend that may appear in the official government report.
Another decline in inventories could reinforce concerns about tighter near-term supply.
By contrast, an unexpected increase in stockpiles could limit further gains in crude prices.
Oil Price Outlook Remains Driven by Supply Risks
The short-term outlook for oil prices remains closely tied to geopolitical tensions and production risks.
Further attacks around the Strait of Hormuz or Saudi energy infrastructure could push crude prices higher.
At the same time, stronger Middle East exports and emergency supply releases could help limit the upside.
Weather conditions in the Gulf of Mexico will also remain important as traders assess the potential impact on U.S. production.
For now, Brent and WTI crude remain supported by concerns that multiple supply disruptions could tighten the global oil market.
