Global crude oil prices took off on Thursday, hitting their highest level in over five months. The sudden rally came after fresh strikes by Iran-backed Houthi rebels hit energy facilities and airports in Saudi Arabia, sparking serious fears that oil shipments could get cut off.
On top of that, news reports stirred up even more anxiety across trading desks. Word got out that the United States and Israel might be preparing heavier military strikes against Iran right after the November midterm elections wrap up.
By 3:50 PM Eastern Time (19:50 GMT), December Brent crude contracts were up 4%, trading at $113.14 per barrel. That is the highest price Brent has seen since early May. Over in the US, West Texas Intermediate (WTI) crude for December delivery climbed 2.2% to settle near $99.31 a barrel.
Middle East Supply Fears Take Center Stage
A statement put out by the Houthis claimed responsibility for four targeted operations over a 48-hour stretch against Saudi Arabian locations. Their targets reportedly included the Ministry of Defense building in Riyadh, an oil site owned by Saudi Aramco in Yanbu, and two commercial airports.
The Houthis have been trading heavy blows with Yemen's Saudi-backed forces ever since a Saudi-led coalition pushed earlier this month to take back ground near the Bab el-Mandeb Strait. That narrow stretch of water is a critical chokepoint connecting the Red Sea to the Gulf of Aden and the Indian Ocean. Fighting right next to it puts massive global tanker traffic in direct danger.
Reports also revealed that Saudi Aramco told employees to evacuate its main headquarters in Dhahran, located right along the Gulf near Bahrain. At the same time, the US Embassy in Riyadh issued a warning to American citizens about possible Houthi attacks targeting local airports.
Adding to the tension, The New York Times reported that American and Israeli officials have been drafting plans to strike Iranian energy plants, nuclear labs, and weapons sites once midterm voting ends. The report said military preparations have picked up speed, with US Defense Secretary Pete Hegseth sitting down with Israeli Prime Minister Benjamin Netanyahu this week to run through tactical options.
Iran fired back with sharp warnings of its own. Tehran promised harsh responses to any American action, threatening strikes against Saudi refineries, computer data centers, and undersea communications cables. Iran has also been stepping up pressure around the Strait of Hormuz. Overnight, seven oil tankers caught fire or suffered severe damage after running into naval mines or getting hit directly by Iranian forces, according to the Associated Press citing Iranian state media.
Traders Keep an Eye on Russia and Ukraine
Before all the Middle East headlines broke, oil had actually traded mostly flat or slightly lower on Wednesday. That temporary calm was driven by faint hopes that Russia and Ukraine might be making headway on diplomacy.
The Kremlin confirmed that US Special Envoy Steve Witkoff sat down with Russian President Vladimir Putin to discuss the war in Ukraine and the chance of setting up a meeting with China. Donald Trump had suggested earlier in the week that a historic three-party summit between the US, China, and Russia could happen.
Ukrainian President Volodymyr Zelenskyy also spoke with Witkoff, pushing for a direct three-way meeting involving Ukraine, the US, and Russia.
Even with talk of diplomacy, fighting on the ground showed no signs of stopping. Zelenskyy announced Thursday that Russian forces launched three waves of 21 ballistic missiles at Kyiv overnight. Meanwhile, news reports indicated that Ukrainian forces launched around 630 drones aimed at Moscow.
Is Saudi Aramco (2222) Cheap Right Now?
With shares moving on the back of rising oil and regional instability, investors are trying to figure out if Aramco stock is a bargain or a trap. Running the numbers through standard valuation formulas helps cut through the noise, showing where fair value sits before taking a position on energy producers caught in the crossfire.
Conclusion for Businesses and Traders
For traders and businesses, the sudden spike in crude is a direct reminder of how fast political trouble turns into real-world costs. When shipping lanes like Bab el-Mandeb and the Strait of Hormuz face active drone hits and floating mines, marine insurance premiums jump instantly, and bunker fuel gets pricier. For everyday businesses reliant on logistics, freight bills are going up over the coming weeks. For commodity traders, the trend stays tilted to the upside as long as physical oil tankers are actually catching fire. Treat any minor dip caused by peace rumors carefully, because the physical risk premium is currently driving this tape.