Oil markets face new risks as Iran targets Gulf shipping routes

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Oil markets face new risks

Highlights

Iran intensifies Gulf attacks.
Saudi oil facilities face strikes.
Brent falls 0.08%, WTI 0.20%.

Tehran had changed its maritime strategy to complicate U.S. efforts to reduce global energy prices. The new approach involves more frequent attacks, and different targeting methods and operations beyond the Strait of Hormuz, where shipping has been severely disrupted since U.S. and Israeli strikes against Iran began on February 28, Reuters reports.

Iran expands attacks beyond Hormuz

The Strait of Hormuz handled approximately one-fifth of global oil and liquefied natural gas trade before the conflict. Iranian restrictions and attacks have sharply reduced traffic, although some tankers continue to pass through the waterway.

At least five incidents involving commercial ships were reported around Hormuz within 48 hours, including drone strikes. Maritime security assessments indicate that the pace of attacks has returned to levels seen during an earlier escalation in October.

Iran has also adapted its surveillance methods after U.S. strikes damaged much of its radar network. American military officials reported that the Islamic Revolutionary Guard Corps had begun using small boats to identify potential targets. U.S. forces recently destroyed one suspected surveillance vessel without reported casualties.

The threat now extends beyond the strait. Recent incidents have been reported near Qatar and the United Arab Emirates, while Iranian officials have warned of tighter restrictions on vessels attempting to bypass Tehran's controls.

Saudi energy infrastructure comes under fire

The escalation has also affected Saudi Arabia. A Houthi missile strike hit Saudi Aramco's executive headquarters in Dhahran on Tuesday, causing a limited fire but no reported injuries.

The attack followed strikes against airports and oil facilities across the kingdom. A refinery in Jazan remains shut following an earlier attack, while a Red Sea export port and a cross-country pipeline have also been targeted.

These incidents have increased pressure on Saudi Arabia's energy infrastructure as regional producers seek alternatives to shipping through Hormuz.

Oil markets face prolonged supply uncertainty

Washington is maintaining economic and military pressure on Tehran through sanctions and a naval blockade of Iranian ports. The conflict, estimated to cost the United States $3 billion monthly, has become an issue ahead of November's congressional elections.

For energy markets, the main concern is that attacks on shipping and export infrastructure could prevent Gulf producers from restoring reliable supply. Higher insurance costs and the risk of further vessel losses may discourage operators even when passage remains technically possible.

Latest oil prices and market reaction

As of October 14, Brent crude traded at $106.19 per barrel, down 0.08%. WTI crude stood at $94.59 per barrel, down 0.20%, according to the supplied market screenshots.

Both benchmarks slipped despite the latest escalation, suggesting traders had not immediately priced in another major supply loss. However, further attacks on tankers, Saudi facilities, or alternative export routes could renew upward pressure on oil prices.

We have previously highlighted that Pakistan urges UN action to protect Red Sea shipping and advance Yemen settlement.

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