Brent rises 1.3% to $115.36 as Houthi claim revives supply fears
Key Facts
Brent crude rose 1.3% to $115.36 a barrel, while West Texas Intermediate climbed 1.22% to $101.12 at 0140 GMT on October 28, according to Reuters. The gains came as concerns about supply risks in the Middle East resurfaced after the Houthis said they had targeted Saudi Arabia's Ras Tanura refinery with a missile. The claim could not be verified, and Saudi Arabia did not comment, according to the Associated Press. Prices therefore moved higher after declining in the previous session, as tensions over energy facilities returned to the market's focus. The move places the targeting claim in the context of supply disruption concerns, but does not establish that the refinery was struck.
The Houthis said on October 27 that they had targeted the refinery in the Eastern Province with a ballistic missile, and their military spokesman said the strike had caused a fire. The Associated Press said it was unable to verify the claim, while Saudi authorities did not comment. Ras Tanura refinery has a capacity of 550 thousand barrels a day, according to a Reuters report, making the facility directly relevant to assessing supply risks if it is confirmed to have been shut down or damaged. The refinery was shut for a period in the first months of the Iran war as a precaution, according to the same report. This provides context for the facility's sensitivity in the oil market, without confirming any shutdown or damage in the current development.
The rebound followed a fall of about $2 on Tuesday, as talks in the Middle East helped temporarily ease supply concerns, according to Reuters. The agency said prices were "recovering after falling about $2 on Tuesday, as talks in the Middle East helped ease supply concerns." The sequence underscores the market's swings between the effects of de-escalation talks and supply security concerns revived by the Houthi announcement. Brent had risen 3.1% to settle at $116.72 on October 23, after trading below $97 at the start of the month, reaching its highest level since June 2022, according to the Associated Press. These levels place the October 28 move within a broader rally during October, with prices still exposed to changes in assessments of regional risks.
On the data front, a Reuters poll of eight analysts forecast a rise of about 15 thousand barrels in U.S. crude inventories for the week ended October 23. The figure reflects poll participants' expectations, not a final inventory result. Inventory data are among the near-term factors monitored by the oil market alongside developments in the Middle East. Markets are also awaiting the OPEC+ meeting scheduled for Sunday, November 1, with three people familiar with the matter expecting the countries to keep December production targets unchanged, according to Reuters. The agency said the countries "are expected to keep December oil output targets steady on Sunday." The upcoming meeting puts the production decision among the market's main events following the latest move, while the expectation that targets will be maintained remains attributed to informed sources.
In daily closing data, Brent settled at $115.40 a barrel on October 28, compared with $113.88 on October 27, according to EL7 data. West Texas Intermediate closed at $101.35, versus $99.9 the previous day. The closes show both benchmarks rising between the two days, alongside the gains recorded by futures at 0140 GMT. The closing figures differ from the prices in Reuters' trading update because they reflect two different times on October 28. The next scheduled events remain the expected U.S. inventory data and the OPEC+ meeting on November 1, which is expected to set production targets for December.