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Brent rises above $100 as Middle East supply risks return
The IEA forecasts a 4.3 million bpd supply cut, about 4% lower by 2026, amid renewed US Iran hostilities and Yemeni Houthi attacks.
Brent crude has moved back above $100 a barrel as renewed conflict in the Middle East raises risks to both production and exports, with the pressure coming despite higher output outside OPEC+. Action Forex says Brent had been below $100 for more than three months, helped by reduced global inventories and weaker Chinese imports, plus increased production in the US, Canada, Guyana, and other regions.
The outlook is clouded by renewed hostilities between the US and Iran, and by attacks from Yemeni Houthis on Saudi Arabia oil infrastructure. Action Forex notes that Riyadh previously used alternative routes to deliver oil to global markets, but those routes could be disrupted if attacks intensify.
Supply risk is also showing up in current shipping flows, with transit through the Strait of Hormuz near zero, Iran reporting plans for a safe passage agreement with Oman. Action Forex cites that on 8 September only six tankers passed through the strait versus nine the prior day, compared with an average of 12 over the previous 10 days.
Forecasts cited in the analysis point to further upside if disruption persists, including expectations from Goldman Sachs for Brent to reach $120 in 2027, and Bank of America projections for a $95 to $125 trading range by year end. Under a more pessimistic scenario, Action Forex reports that Brent could rise to $150 per barrel.
Latest closeWTI crude $94.28 ▲3.1%|Brent $99.39 ▲3.2%