Brent jumps 4% and tops $114 as supply risks mount
Key Facts
Brent crude jumped 4% on Thursday, October 22, after trading below $97 a barrel at the start of the month, amid uncertainty over when the global energy industry would return to normal during the war with Iran, the Associated Press reported. EL7 data show that crude settled that day at $113.17 a barrel, then rose to a close of $114.14 on October 23. Thus, $113.17 was Thursday’s closing price, not an intraday price or the next day’s close. The rise came as concerns resurfaced over the security of supplies and shipping routes in the region. Those concerns carry weight in a market that had already seen disruptions to oil infrastructure in previous weeks.
In Saudi Arabia, the Gulf Cooperation Council said Houthi attacks targeted King Fahd International Airport in Dammam and the Shaybah oil field in the Eastern Province, causing deaths, injuries and material damage. Reuters coverage linked the rise in oil prices to concerns about supply disruptions following the attacks, while the Associated Press reported on the difficulty of returning the global energy industry to normal. The U.S. Energy Information Administration says earlier attacks on Saudi Arabia’s East-West pipeline temporarily halted flows along a route that bypasses the Strait of Hormuz. Before the September attacks, the pipeline carried more than 5.0 million barrels a day through the port of Yanbu. After repairs, flows partially resumed from September 22, according to the agency.
Security concerns do not mean regional exports have stopped altogether: Morgan Stanley analysts estimated that Middle East crude exports were about 17 million barrels a day in the week before the October 22 report. That compares with an average of about 18 million barrels a day during the twelve months before the Iran war began, according to Kpler data cited by Reuters via Euronext. The gap puts the latest weekly flows below the pre-war average, while leaving them at a high level in daily volume terms. In the United States, commercial crude oil inventories, excluding lease stocks, stood at 412.517 million barrels in the week ended October 16, according to EIA estimates. Inventory data provide another indicator of supply conditions in the world’s largest consuming market as geopolitical concerns intensify.
Price movements reflect a sharp trajectory since September: the EIA said the spot price of Brent reached $131 a barrel on September 15. Daily prices then eased somewhat in the final week of the month, after repairs to Saudi Arabia’s East-West pipeline and the partial resumption of flows on September 22. The agency expects Middle East oil flows to remain constrained during the fourth quarter of 2026. In its October projections, it raised its forecast for average spot Brent in the fourth quarter to $105 a barrel, up $14 from the previous month’s forecast. Those estimates remain tied to the agency’s projected path for flow restrictions during the period.
For the following period, the EIA said it expects the average Brent price to fall to $87 a barrel in the second quarter of 2027. That outlook follows its forecast that restrictions on Middle East oil flows will continue through the end of the fourth quarter of 2026, placing the 2027 estimate in a different time frame from the current rally. The Associated Press linked Thursday’s gain to uncertainty over when the global energy industry would return to normal, while EL7 data showed the close remained higher the following day. The background outlined by the agency includes disruption to the Saudi pipeline, followed by a partial return of flows after repairs. Future price and flow estimates are from the EIA, while the closing prices recorded reflect market movements on October 22 and 23.