Brent tops $100 for first time since May after Red Sea attacks

Highlights

Brent crude topped $100 per barrel for the first time since May 2026.
Oil rose after attacks on two Saudi tankers in the Red Sea.
Supply concerns now extend beyond the Strait of Hormuz.
Higher energy prices may add to global inflation pressures.

Brent crude rose as high as $100.05 a barrel, up 4.78%, after Yemen's Iran-backed Houthi movement said it had attacked two Saudi Arabian oil tankers in the Red Sea. The incidents intensified concerns over the security of one of the world's most important shipping corridors, adding to existing uncertainty surrounding crude exports from the Persian Gulf, Bloomberg reports.

Supply risks expand beyond the Strait of Hormuz

The latest attacks shift market attention beyond the Strait of Hormuz, where shipping has already been affected by renewed hostilities between Washington and Tehran. The Bab el-Mandeb Strait, connecting the Red Sea with the Gulf of Aden, has become an increasingly important route for oil exports as companies sought alternatives to the Persian Gulf.

The possibility that both waterways could face prolonged disruption has prompted traders to reassess supply risks. Market participants are also responding to diminishing expectations for a diplomatic breakthrough after officials in both the United States and Iran recently played down the likelihood of resuming peace negotiations.

Higher insurance costs, longer shipping routes, and the prospect of tighter physical supplies have reinforced upward pressure on crude prices. Brent's return to the $100 level reflects growing concern that disruptions could last longer than initially expected.

Energy markets brace for prolonged volatility

The latest rally has broader implications for inflation and monetary policy. Rising oil prices could increase transportation, manufacturing, and utility costs worldwide, complicating efforts by central banks to bring inflation back to target.

For financial markets, the move has renewed speculation that policymakers may have to keep interest rates elevated for longer if energy prices remain high. Oil-producing nations could benefit from stronger export revenues, while importing economies face the prospect of higher fuel bills and renewed pressure on consumer prices.

Geopolitical risk returns to the oil market

The return of Brent above $100 per barrel underscores how quickly geopolitical developments can reshape energy markets. With attacks affecting both the Red Sea region and key Gulf export routes, investors are increasingly pricing in the possibility of prolonged supply disruptions. Unless tensions ease, crude prices are likely to remain highly sensitive to developments across the Middle East.

As we previously reported, Houthis threaten Saudi shipping as oil market risks deepen.

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