Oil prices jumped about 5% Thursday as attacks on shipping in the Gulf collided with a hurricane-driven pullback in U.S. offshore production.
Reuters reported that Brent crude was up $4.55, or 4.54%, at $104.75 a barrel by 12:05 p.m. GMT. U.S. West Texas Intermediate rose $4, or 4.53%, to $92.28. Later in the session, the Guardian put Brent near $105.30.
Two supply risks hit at once
Threats to tankers in the Gulf and Strait of Hormuz intensified in October. Reuters said attacks on ships passing through the strait reached their highest weekly level since the U.S.-Iran war began. Before the conflict, the waterway carried shipments equal to about 20% of the world's oil and fuel.
At the same time, Hurricane Isaias was approaching U.S. Gulf production areas. Shell and Chevron curtailed offshore operations, and producers had shut in 25.08% of the Gulf's oil output and 16.37% of its natural-gas output as of Wednesday, according to figures cited by Reuters.
The broader regional conflict added to the pressure. Reuters said Houthi attacks on Saudi airports killed three people this week as the group expanded strikes against Saudi airspace and energy facilities. The Guardian also reported that the White House had asked to see options for possible new U.S. strikes against Iran before the midterm elections. No decision to carry out those strikes had been announced.
