The situation in the Middle East continues to drive volatility in the oil market. Following the latest developments in the conflict, international oil prices rose, with Brent crude climbing above $99 per barrel, and U.S. WTI crude also rising in tandem, as markets begin to reprice the risks of disrupted supply and shipping in the Gulf region.
Oil prices rise to a phase high.
Brent crude futures rose approximately 2% to $99.05 per barrel, after closing at $97.92 in the previous trading session. U.S. West Texas Intermediate (WTI) crude increased 2.8% to $94.04 per barrel, following a close of $93.03.
Since September, oil prices have risen by more than 8%. The key driver of this movement is the resumption of military strikes between the United States and Iran—the first since July—heightening market concerns over potential disruptions to Middle Eastern energy supplies.
Saudi energy facilities attacked
This week, the scope of the conflict expanded further. Iran-aligned Houthi forces in Yemen attacked multiple energy facilities in Saudi Arabia, causing some facilities to temporarily suspend operations.
The Saudi Ministry of Foreign Affairs stated that economic facilities in Abha, Khamis Mushayt, Jizan, and Najran were targeted, resulting in over 70 civilian injuries. The Saudi Ministry of Energy said the attacks triggered multiple fires, and relevant authorities are working to contain the flames and assess the damage.
Riyadh did not disclose the specific type of facilities targeted. Houthi-controlled media claimed the attacks targeted Saudi Aramco facilities in the southern region, using drones and ballistic missiles.
Market focuses on risks of shipping disruptions
In addition to land-based facilities, risks to maritime transport are escalating. Iranian state media reported that a U.S. missile struck a small tanker approximately four miles off the coast of Kharg Island on Tuesday. Meanwhile, markets continue to monitor whether there will be more severe disruptions to shipping routes through the Strait of Hormuz and the Red Sea.
Goldman Sachs has raised its 2026 December Brent and WTI crude oil price forecasts by $5 each, to $85 and $80 per barrel, respectively; for 2027, the forecasts are $80 and $75 per barrel, respectively.
Goldman Sachs stated that if oil production in the Gulf region remains 4 million barrels per day below pre-war levels by 2027, Brent crude prices could rise above $120 per barrel. The bank believes that intensified attacks on shipping in the Strait of Hormuz and the Red Sea are the primary triggers for this scenario of lower production and higher prices.
Goldman Sachs also expects disruptions in Middle Eastern shipping to persist until 2027, with crude oil production likely to gradually recover in the second half of next year. As the conflict continues, markets are increasingly pricing in the risk of prolonged instability in the Middle East.