LONDON — Brent crude climbed above US$100 a barrel on Wednesday for the first time since July as escalating military confrontation across West Asia disrupted oil and gas flows, intensified shipping risks and raised fresh concerns over global inflation and economic growth.
Oil prices rose 2.2% on September 9 as renewed US attacks on Iran, Yemeni strikes against Saudi energy infrastructure and mounting tensions around the Strait of Hormuz tightened physical energy markets.
According to The Cradle, the escalation has sharply reduced regional oil exports, with crude shipments falling to about 9 million barrels a day and refined-product exports to roughly 1 million barrels, compared with around 20 million barrels a day before the war began on February 28.
The disruption is increasingly being reflected in physical markets rather than merely in futures prices.
WTI crude rose about 1.5% to approximately US$94.50 a barrel, while Oman crude futures climbed to around US$116. Spot-market premiums also returned to levels last seen in April, signalling a tightening supply environment.
“At the moment, it’s telling us that physically things are incredibly tight,” David Fyfe, chief economist at Argus, said, according to The Cradle.
The pressure is particularly acute in refined products. Fyfe said diesel markets were showing signs of a severe shortage, adding another potential inflationary shock for economies already exposed to elevated transport and industrial costs.
Hormuz disruption raises global risk
The Strait of Hormuz remains the critical pressure point for global energy markets. The near-total halt in commercial traffic through the waterway has disrupted shipments of liquefied natural gas, with The Cradle reporting that roughly one-fifth of global seaborne LNG supply has been removed from the market, much of it originating from Qatar.
European gas prices responded sharply. Dutch front-month gas futures rose almost 4% to €78.73 per megawatt-hour, their highest level since January 2023.
The impact is extending beyond the Middle East as European buyers compete with Asian utilities for uncommitted Atlantic cargoes ahead of winter.
For energy-intensive industries, the combination of higher crude, diesel and gas prices represents a renewed cost shock that could feed through into electricity, transport, manufacturing and consumer prices.
Saudi infrastructure comes under pressure
The supply risks intensified after the Yemeni Armed Forces attacked energy-related targets in Saudi Arabia on September 8.
According to The Cradle, Aramco facilities in Abha, Najran and Jizan, as well as Khamis Mushait Air Base, were targeted by ballistic missiles and drones.
Saudi authorities confirmed fires at several locations and a temporary interruption to operations.
The disruption comes as Saudi shipments through the Red Sea port of Yanbu have already fallen significantly. Provisional Kpler data cited by The Cradle showed August shipments at 1.429 million barrels a day, compared with an average of about 3.9 million barrels a day during the preceding three months.
The contraction adds to concerns that available spare capacity may become increasingly difficult to mobilise if attacks continue to affect production, storage, refining or export infrastructure.
Iran-US confrontation raises shipping risk
The energy market is also responding to a widening confrontation between Washington and Tehran.
US Central Command said American forces had destroyed five Iranian crude carriers, while Iran subsequently launched missile strikes against US destroyers and a military base in Jordan, according to The Cradle.
Iran’s Islamic Revolutionary Guard Corps has also expanded its restricted maritime zone beyond the Strait of Hormuz into the Gulf of Oman and Arabian Sea.
For oil traders, shipping companies and insurers, the significance is potentially greater than the headline crude price.
Any sustained restriction on tanker movements increases freight, insurance and security costs while forcing traders to compete for alternative cargoes and routes.
Inflation risk returns
The latest oil shock could complicate the global monetary-policy outlook if elevated energy prices persist.
Higher crude prices feed directly into petrol, diesel and aviation fuel, while natural-gas prices affect electricity generation, fertiliser production, chemicals, metals and manufacturing. The second-round effects can therefore extend well beyond the energy sector.
For emerging markets, the risks are particularly significant. Countries that rely heavily on imported fuel could face deteriorating trade balances, higher inflation and increased pressure on foreign-exchange reserves.
Businesses would also face a squeeze between higher input costs and weaker consumer demand if inflation forces households to reduce discretionary spending.
The critical question for financial markets is therefore whether the current price spike remains a temporary geopolitical premium or develops into a prolonged physical supply shock.
If disruption around Hormuz and regional energy infrastructure persists, Brent could remain above US$100, while gas and refined-product markets could experience even greater volatility.
For the global economy, the danger is not simply expensive oil. It is the possibility that a prolonged energy shock simultaneously raises inflation, increases production costs, weakens household purchasing power and complicates central banks’ efforts to support economic growth.
The Cradle’s reporting therefore points to a market increasingly driven by physical supply constraints rather than speculative positioning — a development that makes the next phase of the West Asian conflict particularly important for global energy and financial markets.
