Global oil markets remain vulnerable to renewed disruption as rising tanker costs and security threats in the Middle East complicate the recovery in Gulf energy supplies.
Brent crude settled at $116.72 a barrel on October 23, its highest close since April 29, gaining
6% over the week. US benchmark West Texas Intermediate closed at $103.27.
Saudi Aramco ordered employees to evacuate its Dhahran headquarters on October 22, Reuters reported, although the reason remained unclear.
The Houthis subsequently claimed attacks on Saudi facilities on October 24, but damage to the reported targets was not confirmed.
The International Energy Agency (IEA) reported that shipping crude from the Gulf to Asia cost more than $37 per barrel by mid-October, over five times prewar levels. Charter rates for some supertankers exceeded $1.3 million a day, raising the cost of delivering oil even as exportsrecovered.
Gulf crude exports reached 13.9 million barrels per day in September, exceeding 75% of prewar levels. However, global observed oil inventories remained 509 million barrels below end-February levels, while global gas oil and diesel exports fell by approximately 700,000 barrels per
day year on year in September, according to the IEA. For refiners, higher transport costs can erode margins and make alternative supplies more expensive.
For import-dependent economies such as Egypt, prolonged disruption could increase
fuel procurement and transportation costs, adding to inflationary pressures.
The key risk is that recovering crude exports may not translate into cheaper fuel while shipping
costs remain elevated and inventories need replenishing.
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