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Oil prices jumped sharply on Thursday, with West Texas Intermediate (WTI) briefly crossing the $100 per barrel mark, as escalating attacks on energy infrastructure heightened fears of prolonged supply disruptions in the Middle East.
By 23:57 ET (03:57 GMT), Brent crude surged 4.3% to $111.97 per barrel, while WTI rose 0.9% to $97.18 per barrel, after earlier touching an intraday high of $100.02.
Energy infrastructure attacks drive rally
Crude extended gains after reports indicated that Israel had targeted facilities in Iran’s South Pars gas field—the largest natural gas field in the world.
Iran responded with strikes on energy infrastructure across the region, including facilities in Qatar, the United Arab Emirates, and Saudi Arabia, raising concerns over a broader disruption to global energy supply.
Tehran had previously threatened key assets such as Saudi Arabia’s SAMREF and Jubail complexes, the UAE’s Al Hisn gas field, and Qatar’s Ras Laffan refinery, signaling a widening scope of potential targets.
Escalation fears deepen market anxiety
Geopolitical tensions escalated further after reports suggested the U.S. is considering deploying thousands of troops to the Middle East. According to Reuters, potential objectives include securing oil tanker routes through the Strait of Hormuz and possibly reinforcing positions near Iran’s Kharg Island, a major export hub.
President Donald Trump stated that the U.S. was not involved in the initial strike on South Pars, while warning Iran against further retaliation. He also indicated that additional escalation could lead to more severe consequences.
Supply disruption risks remain elevated
The ongoing conflict has significantly disrupted oil flows, particularly as the Strait of Hormuz—a critical route for around 20% of global oil supply—remains largely restricted.
Analysts warn that prolonged shipping disruptions could force Gulf producers to reduce output, potentially turning temporary supply shocks into longer-term deficits.
Oil rises despite bearish signals
Oil prices advanced even in the face of traditionally negative factors, including:
- A stronger U.S. dollar
- Hawkish signals from the Federal Reserve
- Unexpected increases in U.S. oil inventories
Earlier in the week, prices had briefly cooled after Iraq and Kurdish authorities agreed to resume exports via Turkey’s Ceyhan port, and as global economies discussed releasing strategic reserves. However, these measures have so far done little to offset the scale of geopolitical risks.
Outlook
With tensions escalating and no clear path to de-escalation, oil markets remain highly sensitive to developments in the Middle East.
As supply risks intensify and energy infrastructure becomes a direct target, crude prices are likely to stay volatile, with upside risks dominating the near-term outlook.
