Brent Surges Above $105 as Hormuz Shipping Risks Intensify

Brent crude surged more than 5% on Thursday as renewed attacks on shipping in the Gulf and Strait of Hormuz intensified concerns about the reliability of Middle East energy flows. Reuters reported Brent at $105.20 a barrel by 1041 GMT, while U.S. West Texas Intermediate crude rose to $92.75. The latest move adds another layer of risk to an oil market already dealing with disruption from the wider U.S.-Iran conflict. The Strait of Hormuz remains a critical export route, and Reuters reported that tanker attacks reached their highest weekly level since the conflict began. Reduced vessel traffic has increased the market's sensitivity to any further disruption. U.S. supply concerns are also supporting prices. Shell and Chevron have curtailed offshore operations in the Gulf of Mexico as Hurricane Isaias approaches, while U.S. crude and diesel inventories have provided additional support after showing larger-than-expected declines. The immediate market focus is therefore split between geopolitical risk and physical availability. Even if crude exports from the Gulf recover, higher insurance, freight and security costs can keep delivered energy prices elevated and make the market more volatile. For inflation-sensitive markets, a sustained move in Brent above $100 could complicate expectations for central-bank policy because higher fuel costs can feed into headline inflation. Oil-importing economies and currencies may also face renewed pressure if energy prices remain elevated. The next major signal will come from developments around tanker traffic and the security situation in the Strait of Hormuz. Any evidence of safer and more regular shipments could reduce the geopolitical premium, while additional attacks or production interruptions could extend the latest price surge. MarketMindFX View: Thursday's move shows that oil prices are being driven as much by logistics and geopolitical risk as by conventional supply-and-demand balances. Traders are likely to remain highly sensitive to shipping data and official energy-supply measures.