Brent Crude Oil Futures Surpass $100 Per Barrel Intraday for the First Time Since July 24
Brent crude oil surpassed $100 per barrel intraday.
Brent crude oil futures broke through $100 per barrel intraday for the first time since July 24, before retreating to near that round number.
In early Asian and European trading, Brent rose about 2%, reaching approximately $100.19; West Texas Intermediate crude also increased, trading around $94.5. Since early August, Brent has accumulated a rise of about 25%.
The price surge is driven by expectations of supply disruptions due to escalating conflicts in the Middle East. The U.S. Central Command reported the destruction of several Iranian oil tankers; Iran claimed to have targeted U.S. bases and vessels near the Strait of Hormuz. Attacks by Houthi forces on Saudi energy facilities have also introduced new risks of disruption in the Red Sea alternative route.
Traffic in the Strait of Hormuz has fluctuated significantly: According to Rystad Energy's chief economist, prior to the resurgence of conflict on August 30, daily oil flow through the strait was about 8 to 9 million barrels, but has recently dropped to less than 2 million barrels. Before the conflict, this waterway typically carried about 20% of the world's tradeable oil.
Saudi Arabia's east-to-west pipeline and alternative routes like Fujairah partially offset losses from the strait, but with new threats to the Red Sea, this buffer has weakened. Analysts note that the market is beginning to price in a longer conflict rather than a quick return to normal shipping.
Mechanically, this represents an event-driven risk premium: refiners and aviation fuel buyers are locking in prices early, while speculative funds push up near-term contracts; beneficiaries include producers who can still export from the Red Sea or Atlantic basin, and traders holding inventory. Those under pressure are Asian refiners reliant on Gulf imports, transportation and chemical costs under high oil prices, and interest-sensitive assets amid rising inflation expectations. The buffer inventory in the physical market has been partially consumed, and once paper prices break through round numbers, the premium is more easily transmitted to refined products.
Goldman Sachs and others have previously provided higher price paths under scenarios of continued blockage in the strait, including a forecast that prices could reach $120 in the fourth quarter; Trump has publicly stated that oil prices will significantly drop after the war ends. Both narratives coexist, with near-term prices following shipping schedules and attack frequencies rather than endgame declarations.
Source: Public Information
ABAB AI Insight
Brent's rise above $100 is not just a speculative pulse, but re-prices the Strait of Hormuz from a "bypassable bottleneck" to a constraint where flow can drop to below 2 million barrels. Since the conflict began in late February, Gulf exports have relied on east-to-west pipelines, Fujairah, and dark ships to maintain some shipments; with the Red Sea being attacked again, it effectively raises the risk premium on backup exports. The significance of the round number is that it simultaneously alters the procurement benchmarks for refiners, aviation hedging, and inflation trades.
The capital path absorbs shocks through near-term crude, freight, and refined product crack spreads, while long-dated contracts absorb the political narrative of "oil price drop after the war ends." Traders are shifting positions from spot cargoes in the strait to the Atlantic basin and inventories already in transit. The U.S. release of strategic reserves and increased exports can only partially fill the Gulf shortfall and cannot replace the daily flow of the narrow waterway.
A similar reference is Brent's spike after the outbreak of the Russia-Ukraine war in 2022, and the surge in freight when the Yemen conflict disrupted the Red Sea. The current phase is not about demand expansion, but about channel control: those who can still navigate out of the Gulf hold the spot pricing power.
This represents a restructuring of the supply chain: crude pricing has shifted from production meetings to waterway accessibility. The mechanism is that about 20% of globally tradeable oil is bound to the same strait; when flow drops from 8 to 9 million barrels to less than 2 million barrels, paper prices must first fill the physical gap before discussing demand destruction.
ABAB News · Cognitive Law
When the strait narrows, production numbers become shipping schedule numbers.
When alternative routes are attacked, the premium truly solidifies.
Round numbers are not just sentiment; they mark the moment when procurement benchmarks are rewritten.