By Kehinde Victor

KEY POINTS

• Oil prices rose as reports of possible renewed US military strikes against Iran raised concerns about fresh disruption to Middle East energy supplies.
• West Texas Intermediate (WTI) moved towards $103 per barrel, while Brent settled near $115.
• A senior US military commander reportedly briefed President Donald Trump on military options against Iran.
• Brent has gained 12% in October, reaching a six-month high as the conflict continues.
• Shell’s CEO warned that depleted global oil inventories mean current prices may no longer be temporary.

MAIN STORY

Oil prices rose on Thursday as renewed concerns about possible US military strikes against Iran threatened to deepen tensions in the Middle East and disrupt global energy supplies.

West Texas Intermediate (WTI) crude gained towards $103 per barrel after fluctuating by more than $3 in the previous session, while Brent crude settled near $115.

The Wall Street Journal reported that a senior military commander had briefed US President Donald Trump on military options. Trump has repeatedly indicated that he could resume airstrikes against Tehran after next week’s US midterm elections.

The possibility of renewed attacks has raised concerns about the security of oil shipments from the Middle East, particularly through the Strait of Hormuz, a critical route for global energy supplies.

In Iran, Parliament Speaker Mohammad Bagher Ghalibaf suggested that the country’s position on ending the war would not be compromised. His comments followed confirmation from Tehran that Iranian officials had received a letter sent by US Vice President JD Vance.

The diplomatic exchange has not removed uncertainty over whether the conflict can be resolved without further military action.

THE ISSUES

Conflict keeps oil prices elevated

Brent has gained 12% in October, reaching a six-month high as the conflict continues.

The rally has persisted despite the revival of some oil shipments from the Middle East. Producers have managed to move cargoes through the Strait of Hormuz, although shipping risks remain elevated.

This means the market is facing two competing developments: oil continues to flow through the region, but the possibility of renewed military action threatens to disrupt those supplies again.

A fresh escalation could increase uncertainty over shipments and push prices higher, particularly if traders begin to anticipate a more prolonged disruption.

Depleted inventories raise concerns

Oil companies’ earnings and comments from industry executives are also drawing attention this week.

ExxonMobil and Chevron are scheduled to release their results later on Friday, while Shell Chief Executive Officer Wael Sawan said on Thursday that current oil prices no longer appeared temporary because global inventories were so depleted.

His assessment suggests that the market may have limited запас to absorb another major supply disruption without a stronger price response.

WHAT’S BEING SAID

“Current oil prices no longer looked temporary because global inventories are so depleted.” – Wael Sawan, Chief Executive Officer, Shell Plc.

WHAT’S NEXT

Traders will be watching for further signals from Washington and Tehran, particularly whether the United States moves towards renewed military action or diplomatic engagement.

The outcome of next week’s US midterm elections could also influence the timing of any decision by Trump, who has repeatedly indicated that military strikes could resume afterwards.

Investors will also assess the results from ExxonMobil and Chevron for indications of how major oil producers are responding to the current price environment.

In Israel, Prime Minister Benjamin Netanyahu and his allies secured 53 seats in this week’s general election, ahead of the main opposition bloc’s 48 seats. However, they fell short of the majority needed to govern without additional support.

Israel joined the United States in launching the war against Iran in February, with the stated aim of dismantling its nuclear programme. The election outcome adds another political development to an already uncertain regional situation.

BOTTOM LINE

Oil prices are being supported by the risk that military action between the United States and Iran could intensify again, threatening energy shipments from the Middle East. Although producers have continued moving cargoes through the Strait of Hormuz, depleted global inventories could make the market more vulnerable if supplies are disrupted.

Bloomberg