Oil prices rose by more than 1 percent as attacks on Saudi Arabia kept supply risks in the spotlight
On Tuesday, the Houthis announced that they had struck Saudi Arabia's largest oil refinery. As attacks against the world's second-largest crude oil producer—and a top importer—intensify, concerns regarding supply risks have flared up, pushing oil prices up by more than 1 percent on Wednesday.
Saudi officials have yet to confirm the attack on the facility, which has a daily capacity of 550,000 barrels. For now, the market views the possibility of a renewed escalation in tensions as high.
As of 04:35 GMT, Brent crude futures were up $1.59 (1.4 percent) at $115.47 per barrel. Meanwhile, U.S. West Texas Intermediate (WTI) crude gained $1.43 (1.4 percent) to reach $101.33.
Prices rebounded following a decline of approximately $2 on Tuesday.
Oil prices remain elevated as the market awaits clearer signals regarding what Trump’s next move toward Iran might be.
If the election period passes without any new aggression toward Iran, it could be enough to begin reducing the risk premium currently priced into the market.
According to data from the American Petroleum Institute (API), U.S. crude oil inventories have declined. Sources indicated that crude oil stocks fell by 2.03 million barrels during the week ending October 23. Analysts had estimated that crude oil inventories increased by approximately 15,000 barrels during the week in question.
The market is now awaiting the official weekly inventory report from the U.S. Energy Information Administration (EIA), due later today, for a clearer picture.
According to sources familiar with the matter, the market is also closely monitoring an industry meeting scheduled for Sunday. The OPEC+ group of oil producers is expected to keep its production targets for December unchanged. For most of the seven key OPEC+ members—Saudi Arabia, Russia, Iraq, Kuwait, Algeria, Kazakhstan, and Oman—actual production is currently falling short of the established targets.
Meanwhile, Russian crude oil exports from Baltic and Black Sea ports may decline next month, as domestic refineries ramp up diesel production following an agreement reached with Washington.
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