Oil: Brent surpasses $108, reaching its highest level since May

Oil prices continued to rise on Friday, September 11, in Asia, with Brent reaching $108.68 per barrel and West Texas Intermediate (WTI) at $103.45 around 00:45 GMT. Both benchmarks gained nearly 13% over the week, driven by concerns over supply in the Middle East.

Brent and WTI are thus on track for their first weekly close above $100 since mid-May. The two contracts had already surged by more than 6% on Thursday, amid a market tense from regional military escalation and risks affecting several major export routes.

According to the Associated Press, Brent has returned to its highest levels since May. The rise in energy prices rekindles inflation fears and weighs on financial markets, as transportation and production costs increase with the rising price of crude.

Investors are particularly monitoring the Red Sea and the Strait of Hormuz. According to Reuters, the Houthis’ advance towards the Bab el-Mandeb area, following their capture of Mokha, has heightened concerns about further disruptions to a vital route for global oil and refined product trade.

A week of significant gains

The current movement marks a clear acceleration compared to the beginning of the week. On September 8, the Brent was still below $100. Three days later, it exceeds $108, while WTI settles above $103.

This increase comes as OPEC+ producers have opted not to add new volumes in October. In a statement released on September 6, OPEC indicated that Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman would maintain their required production levels from September in October.

Markets fear a lasting shock

The rise in oil prices is already impacting bond markets and interest rate expectations. The increase in energy costs complicates the disinflation trajectory for several economies and fuels expectations for the continuation of restrictive monetary policies.

The next meeting of the seven participating OPEC+ countries is scheduled for October 4, according to the statement released by the organization on September 6.