Oil prices rose Wednesday as traders weighed persistent Middle East supply risks after a reported attack on a Saudi Aramco building and fresh strikes on tankers around the Strait of Hormuz.
December Brent crude futures rose 0.2% to $105.92 a barrel, while December West Texas Intermediate futures gained 0.2% to $93.39 a barrel. The gains followed a mixed session Tuesday, when Brent settled lower while front-month U.S. crude edged higher.
Regional tensions remained elevated after Saudi Arabia's Energy Ministry said an administrative building belonging to Saudi Aramco in the eastern city of Dhahran, where the oil giant's headquarters is based, was targeted Tuesday evening, causing a limited fire. No injuries or fatalities were reported, the ministry said.
U.K. Maritime Trade Operations reported another attack Tuesday involving a tanker struck by an unidentified projectile in the Strait of Hormuz. Authorities were investigating the incident, the agency said.
Despite the continuing shipping risks, crude oil continued to flow through the waterway. U.S. Central Command said Tuesday that American forces had assisted Gulf partners in shipping more than 19 million barrels of crude through the Strait of Hormuz on Monday. The command also rejected an Iranian military claim that Tehran controlled the waterway.
Elevated shipping costs are also influencing oil-price forecasts. Morgan Stanley raised its Brent forecast for the fourth quarter to $105 a barrel from $100, citing tight supplies, geopolitical risks and higher freight costs. The bank said shorter shipping distances to European markets favor Brent, while crude from Brazil, West Africa and the U.S. has become less competitive because of higher freight costs. It also raised its first-quarter 2027 Brent forecast to $100 from $95.
In refined-product markets, India's middle-distillate exports could remain elevated as European diesel supplies remain tight, according to S&P Global Energy. European diesel inventories are expected to fall to their lowest year-end level in more than a decade, Saransh Katiyar, an analyst at S&P Global Commodities at Sea, said. India's middle-distillate exports reached a one-year high of nearly 740,000 barrels a day in September, according to the firm's data.
The International Energy Agency is scheduled to release its October oil market report Wednesday, providing updated assessments of global supply, demand and inventories amid the continuing disruptions.
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