Brent Crude Oil Surges to $116 per Barrel, Hitting Nearly Six-Month High
Brent crude futures rose above $116 per barrel on Friday, reaching the highest level in nearly six months since the end of April.
The increase for the day was about 2.6%, with prices peaking at $116.13. West Texas Intermediate crude also rose about 3% to around $102.56. The market attributed this surge directly to escalating tensions in the Middle East, with traders anticipating that the U.S. may resume strikes against Iran in the coming weeks.
The Chief of Staff of the Iranian Armed Forces stated through the Tasnim news agency that Tehran has strengthened its capabilities and is fully prepared for asymmetric warfare. Meanwhile, Iranian ally Houthi forces continue to launch attacks on Saudi Arabian energy facilities and airports, prompting the U.S. State Department to order the evacuation of some non-essential diplomatic personnel from Saudi Arabia.
Shipping attacks near the Strait of Hormuz have become frequent, with the Iranian Revolutionary Guard claiming that several oil tankers have been attacked or hit mines, leading Saudi Aramco to request the evacuation of employees from its Dhahran headquarters. Although Middle Eastern oil exports are nearing pre-war levels, the risk premium for supply disruptions continues to expand.
Brent has accumulated a gain of over 80% this year, having reached a peak of around $126 in April. Global inventories are at low levels, refining profits are expanding due to supply concerns, and increased trading volume in futures and options indicates that institutions are actively hedging risks.
Driven by events, speculative funds and hedging buyers are heavily purchasing crude oil futures, benefiting oil-producing countries and upstream energy companies from high prices, while downstream industries such as aviation, shipping, and chemicals, as well as crude oil importing countries, face rising cost pressures, with funds flowing from risk assets to commodities.
Source: Public Information
ABAB AI Insight
Since the conflict between the U.S. and Iran erupted at the end of February 2026, oil prices have experienced significant volatility multiple times. In April, Brent briefly surged above $126, then fell back amid negotiation expectations, but repeated attacks have kept the risk premium persistent. The Houthi forces have long targeted Saudi energy infrastructure, with attack patterns highly similar to the 2019 assaults on Aramco facilities that led to temporary supply disruptions.
With high oil prices, funds continue to flow to producers like Saudi Aramco and ExxonMobil, as well as long positions in crude oil futures. The U.S. is attempting to lower domestic energy prices by utilizing strategic petroleum reserves and adjusting sanctions on Russia to address inflation pressures ahead of the midterm elections. The core of resource mobilization lies in maintaining alternative routes through the Strait of Hormuz and Gulf export capabilities.
This situation resembles the early stages of the 2022 Russia-Ukraine conflict when oil prices soared above $130, or the short-term supply shocks caused by the 2019 attacks on Saudi oil facilities. The industry is currently in a phase dominated by geopolitical conflict risk expansion, rather than a traditional demand recovery or capacity expansion cycle.
Essentially, this represents a shift in pricing power. Traditional supply-demand balance pricing is being dominated by geopolitical risk premiums, as the Strait of Hormuz carries about one-fifth of global oil trade; any expectation of disruption is magnified by the market into a sustained premium, granting short-term pricing advantages to producing countries while imposing costs on consuming countries.
ABAB News · Cognitive Laws
Risk Premium = Channel Vulnerability × Attack Frequency
High oil prices benefit producing countries, pressure importing countries
Geopolitical conflicts render inventory buffers ineffective