Brent Crude Rises to $106.58 as Houthi Strikes and Hormuz Risks Offset Russian Diesel Hopes

Brent crude futures rose 89 cents, or 0.8 percent, to $106.58 a barrel by 0030 GMT on Wednesday. US West Texas Intermediate gained 80 cents, or 0.9 percent, to $94.94. Brent had fallen 0.9 percent on Tuesday while WTI rose 0.4 percent. The move followed a Houthi attack that struck an administrative building at Saudi Aramco's headquarters complex in Dhahran, causing a limited fire but no casualties.

Hiroyuki Kikukawa, chief strategist at Nissan Securities Investment, said supply concerns from the fighting between the Houthis and Saudi Arabia are pushing prices higher. Expectations of increased Russian diesel exports could ease market tightness and limit sharp moves, he added, projecting WTI between $90 and $100 a barrel. Riyadh's international airport has been hit four times in the past week, including a Saturday attack that killed 13 people.

Iran has widened attacks on commercial shipping in the Strait of Hormuz. Two senior Iranian officials told Reuters that Tehran has changed the type and pace of strikes to keep oil prices elevated ahead of US midterms. At least five incidents occurred in the past 48 hours. The US said it assisted in shipping more than 19 million barrels of crude through the waterway, yet more supertankers have turned away. Freight costs have risen.

OPEC reported that OPEC+ production rose sharply in September, driven by higher Saudi output, despite the shipping disruptions. Morgan Stanley raised its forecast for physical Dated Brent by $5 a barrel for this quarter and the next, noting that crude exports continue but uncertainty remains elevated. Brent has surged more than 70 percent this year amid the broader Middle East conflict.

For importers the $106 level raises the cost of energy and the risk of further pass-through to fuel prices. India's recent growth upgrades have already factored in higher oil, yet sustained levels near current prices would pressure the current account and inflation readings. Saudi Energy Minister Prince Abdulaziz bin Salman has sought to reassure markets that the kingdom's supply remains resilient.

Traders are balancing the immediate risk of further infrastructure hits against the possibility that Russian diesel flows and OPEC+ production increases could cap gains. A widening of Houthi targeting to additional Aramco facilities or a further tightening of Hormuz traffic would push the upper end of the range. A de-escalation or confirmed higher Russian volumes would pull prices back toward the lower end of Kikukawa's band.

The session's early gains show that the Dhahran strike registered with the market even though it caused only a limited fire at an administrative building. Physical flows have not been interrupted at scale, but the repeated targeting of Saudi sites and the Hormuz campaign have kept a risk premium in the price. Further official statements from Riyadh or Tehran will determine whether that premium expands or contracts in the next sessions.