Brent crude settles at $116 after Iran names Gulf tech hubs for strike

Oil markets have entered a new phase of volatility as geopolitical risks in the Middle East drive prices to multi-month highs. Brent crude, the global benchmark for pricing, closed Friday trading just above $116 per barrel.

The price action began with a sharp intraday spike of roughly 3.5 percent. At its peak, the benchmark surpassed $117 per barrel, a level not seen since April. Although the price retreated slightly before the close, it remained more than 2.7 percent higher than the previous session.

The surge followed specific warnings from Tehran regarding its retaliation strategy. Iranian officials stated that if a new joint US-Israeli offensive begins, the country will target oil facilities, undersea cables, data centers, and artificial intelligence infrastructure in the Gulf. Richard Hunter, a broker at Interactive Investor, noted that reports of a renewed US military strike plan, timed for after the midterm elections, triggered the price jump. He observed that the conflict, initially viewed as brief, is now entering its eighth month.

The current price levels mark a stark contrast to pre-war trading. In February, before the war with Iran began, Brent crude traded at approximately $72 per barrel. By the end of April, peak tensions had pushed the price to $126 per barrel. The current environment keeps costs elevated for global consumers and businesses.

Regional instability has intensified this week, adding physical risk to the supply chain. The Islamic Revolutionary Guards Corps claimed strikes on four commercial ships in the Strait of Hormuz on Wednesday. The strait is a critical chokepoint for global oil shipments. In response to the growing threat, the US State Department ordered some diplomats and the families of US government employees to leave Saudi Arabia. The kingdom has faced continued attacks from Yemen-based Houthi rebels.

Susannah Streeter, chief investment strategist at Wealth Club, highlighted that fears are mounting that US and Israeli forces may target Iran’s energy infrastructure after the US elections on November 3. She pointed out that Houthi attacks on Saudi facilities have intensified this week. Streeter added that the journey across the Strait of Hormuz remains dangerous due to projectiles being fired at maritime traffic.

Global supply concerns extend beyond the Middle East. Streeter noted that Ukraine’s bombardment of Russian diesel refineries is also impacting the global energy market. This additional pressure on supply chains complicates an already volatile environment. The next major scheduled event is the US presidential election on November 3, which market watchers expect will influence the timing of potential military actions.