Oil prices rose on Tuesday as attacks on Saudi energy facilities compounded fears of escalating hostilities between the U.S. and Iran in recent days.
Brent crude futures, the international benchmark, rose 1.67% to $98.61 a barrel by 7:44 a.m. E.T. U.S. West Texas Intermediate futures advanced 2.6% to $93.84 per barrel.
The Saudi energy ministry said operations at certain energy facilities had been halted after strikes by Iran-aligned Houthi militants based in Yemen wounded more than 70 people.
Emergency services are working to contain fires at the sites and assess the extent of damage, the world’s largest oil exporter added.
A military spokesman for the Houthis said the group attacked Saudi Aramco facilities in southern areas with drones and ballistic missiles.
ExxonMobil shares were up 1.96% in premarket trading early Tuesday, while Chevron advanced 1.35%.
It comes after the U.S. military struck three Iranian oil tankers on Saturday in retaliation for Iranian ballistic missile attacks on two Navy warships. The Iranian Foreign Ministry, in a statement on Saturday, denounced the attacks on commercial vessels as a “war crime” and an act of “economic warfare.”
“This appears to be a major escalation and tensions have once again ratcheted higher,” said David Morrison, senior market analyst at Trade Nation, noting that U.S. Energy Secretary Chris Wright had said it may prove impossible to reach a deal with Iran to prevent it obtaining a nuclear weapon.
The tit-for-tat strikes over the weekend also helped to push gas prices higher, hitting record highs.
Tensions between Washington and Tehran continued to simmer. “Strike our assets and you get struck,” Iranian Parliament Speaker Mohammad Bagher Ghalibaf wrote Monday in a post on X.
That was in response to Defense Secretary Pete Hegseth’s post who wrote that the U.S. “will destroy (and sink)” Iranian oil tankers if Iran fires on U.S. vessels.
Goldman Sachs on Monday raised its forecasts for Brent and WTI prices by $5 to $85 and $80 per barrel, respectively, for December 2026 and to $80 and $75 per barrel, respectively, for 2027.
The bank expects Mideast shipping disruptions to continue into 2027, with production gradually recovering by the second half of 2027. “Markets are increasingly pricing a prolonged Mideast conflict,” Goldman said, adding that Persian Gulf-to-China crude tanker rates in the second quarter of 2027 now price shipping disruptions lasting into that period.
President Trump in a post on Monday stateside said that “Oil prices will drop precipitously … when we WIN the war with Iran.”
— CNBC’s Greg Iacurci contributed to the report.
