Global Oil Supply Threatened; Brent Holds Firm!

Global oil prices held steady around US$106 per barrel during Thursday's trading (Oct 15), following a 1.3% gain for Brent crude over the first three sessions of the week. Geopolitical tensions in the Middle East and involving Russia have reignited concerns regarding global energy supplies—supplies that had only recently recovered to levels nearing those seen prior to the US-Iran conflict.

The situation escalated after a cargo ship sank upon being struck by an unidentified projectile while transiting the Strait of Hormuz. Meanwhile, the Iran-backed Houthi group has continued to launch missile and drone attacks against Saudi Arabia. Separately, Russia has accused Ukraine of attacking two oil refineries in Saratov and Ryazan—allegations that Kyiv has denied and which have not yet been independently verified.

These security disruptions have heightened risks to global oil distribution. A number of tankers with a combined capacity of at least 37 million barrels have reportedly halted or altered their routes toward the United Arab Emirates and Oman. Although there is no clear evidence yet of a decline in Gulf oil exports, the growing threat to shipping lanes is fueling market anxiety. The International Energy Agency (IEA) has also reported that onshore oil inventories are nearing their lowest levels in at least a decade.

From the United States, the American Petroleum Institute (API) reported an 11.1-million-barrel drop in crude oil inventories last week. If confirmed by official data, this would mark the largest decline since June 2025. Tight supply conditions have made the market increasingly sensitive to conflict developments. Brent crude itself has surged more than 70% so far this year due to energy market disruptions triggered by the US-Iran war.

Despite persistent supply risks, oil prices saw a slight correction in early Asian trading. The December Brent contract fell 0.5% to US$105.53 per barrel, while the November WTI contract weakened 0.4% to US$94.67. Looking ahead, uncertainty regarding the resolution of the conflict in the Middle East and the threat of attacks on energy infrastructure could potentially keep oil prices high.