Supply disruption concerns in the Middle East drive oil prices up

Maritime shipping risks in the Red Sea and attack threats against Saudi Arabia's oil infrastructure heightened supply disruption concerns in the Middle East, causing oil prices to rise on Wednesday.

Brent crude futures increased by 0.78 percent to $109.64 per barrel, while U.S. crude (WTI) rose by 0.78 percent to $98.58. The Islamic Revolutionary Guard Corps Navy announced that a supertanker caught fire after hitting a naval mine south of the Strait of Hormuz. According to vessel-tracking firm Kpler, attacks on at least 18 vessels were reported over a two-week period, with LSEG analysts noting that the attacks extended as far as the Gulf of Oman.

The Houthis claimed responsibility for attacks on Aramco's Yanbu facility, the Shaybah oil field, and airports in Riyadh and Abha in Saudi Arabia, while the death toll from Houthi attacks targeting government forces in Yemen rose to 73. Oil prices had retreated in the previous session following mediation efforts by the Iranian president in Tehran, with Brent crude falling 0.69 percent to close at $108.79 on Tuesday after reaching a five-month high of $111.99 intraday.

U.S. Department of Energy officials announced they were working with global refineries to increase fuel production as diesel shortages drive up prices, while eight analysts surveyed by Reuters estimated that U.S. crude oil inventories decreased by approximately 800,000 barrels in the week ending October 16.