Key facts
- Brent crude futures rose 4.0% to $107.18 a barrel.
- US West Texas Intermediate (WTI) crude futures rose 4.0% to $95.82 a barrel.
- Saudi Arabia intercepted six ballistic missiles fired by the Houthis.
- Iranian flights to Gulf neighbors appeared to have been canceled after a US deadline for firms to halt work with Iran's airlines.
- US diesel futures were trading up over 5%.
Oil prices jumped about 4% to a one-week high on Thursday, driven by Houthi missile attacks on Saudi Arabia and a lack of progress in US-Iran diplomatic talks. Brent crude futures rose $4.10, or 4.0%, to $107.18 a barrel, while US West Texas Intermediate (WTI) crude futures gained $3.66, or 4.0%, to $95.82.
The rally followed two days of gains that pushed Brent up about 8%, with the benchmark on track to close at its highest level since September 15. WTI was poised to rise for the first time in seven days after a roughly 13% decline over the preceding six days.
Saudi Arabia's coalition in Yemen announced that the kingdom intercepted six ballistic missiles fired by the Iran-backed Houthis, thwarting attacks on the southern province of Taif and the Red Sea area of Yanbu. Meanwhile, Iranian flights to Gulf neighbors, including Dubai, appeared to be canceled after a US deadline passed for global firms to halt business with Iran's airlines, a move US President Donald Trump described as "economic D-Day."
With battlefield progress in the US-Iran conflict largely stalled, Washington has intensified financial sanctions, targeting third-country companies doing business with Iranian firms through "secondary sanctions." Iran has threatened retaliation against any neighboring countries complying with the US ban on its flights. A senior Iranian official told Reuters on Wednesday that Iran and the United States remain far apart on ending their conflict, but diplomacy must continue, after Iran's president stated Tehran would never surrender to US pressure.
Separately, Saudi Arabia is increasing crude pumping volumes through its East-West Pipeline to its Red Sea export hub of Yanbu, though crude tanker loadings have yet to resume, according to industry sources, satellite imagery, and shipping data.
In the diesel market, prices have hit record highs. High-level contacts between the European Union and the United States are ongoing regarding a reported US plan to ban diesel exports, which the EU believes could negatively impact both sides. Politico reported the US was preparing a 90-day ban on diesel exports amid rising prices ahead of the November midterm elections, though US Energy Secretary Chris Wright has disputed this. Analysts warn such a ban would do little to ease high energy prices and could worsen global supplies and disrupt economies. US diesel futures were trading up over 5% on Thursday.