New Delhi, Sep 11: Oil prices extended their gains on Friday, with Brent and US crude heading for their strongest weekly rise in months as escalating attacks around key Middle East shipping routes raised fresh concerns about the security of global oil supplies.
Brent crude futures rose 81 cents, or 0.8 per cent, to $108.44 a barrel, while US West Texas Intermediate (WTI) gained 69 cents, or 0.7 per cent, to $103.17 a barrel. Both benchmarks had jumped more than 6 per cent in the previous session.
Crude prices were up nearly 13 per cent for the week, putting both benchmarks on course for their biggest weekly increase since mid-July.
The latest surge has been driven largely by growing concerns over disruptions to major oil and shipping routes in the Middle East. The seizure of Yemen’s port of Mocha by Iran-aligned Houthis has increased risks for Red Sea shipping, while continued tanker attacks have restricted traffic through the strategically important Strait of Hormuz.
The Strait remains a critical artery for global energy supplies, making any prolonged disruption a major concern for oil-importing economies. Although some crude is still moving through the waterway, flows remain well below pre-war levels, highlighting the growing fragility of regional supply chains.
The pressure is also spreading to fuel markets. Disruptions linked to the US-Iran conflict, along with attacks on Russian refineries, have contributed to a sharp rise in US diesel prices, with the national average crossing $6 a gallon for the first time, according to GasBuddy.
Markets are now closely watching whether the conflict will remain contained or lead to wider disruptions affecting oil production, refining and transportation infrastructure.
China is another key factor for the market. As the world’s largest crude oil importer, continued strong Chinese purchases could further tighten available supplies and amplify the impact of disruptions in the Middle East.
At the same time, OPEC has lowered its forecast for global oil demand growth in 2026 to 380,000 barrels per day, marking its fifth consecutive downward revision. OPEC’s oil output also fell by around 640,000 barrels per day in August, according to a Reuters survey.
The combination of supply uncertainty, falling output and geopolitical tensions has kept traders on edge. While weaker demand expectations could limit the rally, any further deterioration in regional oil flows could push prices significantly higher.
For oil-importing economies, sustained crude prices above $100 a barrel could translate into higher fuel, transport and production costs and add to inflationary pressures. Businesses that depend heavily on energy and transportation could face increased operating expenses, while consumers may eventually feel the impact through higher prices.
The immediate direction of the oil market will depend largely on whether physical supplies and shipping routes begin to recover. A further deterioration could keep crude prices elevated, while an improvement in regional flows could ease some of the pressure.
For now, the oil market remains highly sensitive to developments in the Middle East, with traders closely watching whether the current supply disruption becomes a temporary shock or a prolonged challenge for global energy markets.