The week’s rally, which saw Brent climb 6.2% and West Texas Intermediate rise 4.3% to $103.27, reflects a growing geopolitical risk premium. Analysts at MUFG noted that the latest military buildup challenges earlier assumptions that post-election diplomacy would stabilize regional trade. Current market sentiment is driven less by immediate supply shortages and more by the vulnerability of critical transit routes, such as the Strait of Hormuz, where flows remain roughly 26% below prewar levels.

Escalating security concerns were further fueled by Houthi militia attacks on Saudi Arabia’s Shaybah oil field and the King Fahd International Airport. While Saudi energy officials reported that operations at Shaybah were unaffected, the continued interception of drones over the kingdom’s southern region has kept traders on high alert. ING analysts now consider their previous $80-per-barrel forecast for the fourth quarter unattainable, as the threat of renewed U.S.-Iran hostilities continues to override data showing that total regional oil shipments have technically recovered to above-prewar volumes of 24 million barrels a day.