Brent crude futures rose 2.2% to $96.14 per barrel following Houthi attacks on Saudi oil tankers in the Red Sea. The disruption to vital shipping routes and retaliatory U.S. strikes have created supply concerns for global energy markets, potentially impacting fuel costs for import-dependent nations like India.
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Global crude oil prices moved higher on Thursday as geopolitical tensions in the Middle East intensified. Brent crude futures climbed 2.20 percent to reach $96.14 per barrel, while West Texas Intermediate (WTI) futures rose 1.75 percent to $88.35. The movement follows reports of missile and drone strikes targeting Saudi Arabian oil tankers in the Red Sea, a critical corridor for global energy shipments.
Saudi Arabia’s Transport General Authority confirmed that the tanker ENCELIA was damaged during the incident. While no casualties were reported, the attack has heightened concerns about the safety of commercial vessels passing through the region. In response to the escalating situation, the U.S. Central Command announced it carried out military strikes against Iranian maritime facilities, missile storage, and surveillance infrastructure on July 22. These actions are intended to curb threats to international shipping, with reports indicating that U.S. forces have already redirected or blocked several vessels linked to Iranian ports.
For investors, the primary concern is whether these supply route disruptions will lead to sustained energy price inflation. When shipping lanes like the Red Sea face threats, insurance premiums for tankers often rise, and logistics costs increase, which can eventually pressure the profit margins of oil-importing companies and transportation sectors. India, which relies on imports for the majority of its crude oil requirements, typically faces direct pressure on its import bill and currency stability when global oil prices spike.
Adding to the market complexity, the latest report from the U.S. Energy Information Administration (EIA) for the week ending July 17 showed a 2-million-barrel increase in commercial crude inventories. However, total stockpiles remain 6 percent below the five-year average, suggesting that the supply buffer is tighter than historical norms. Although demand for gasoline and diesel has shown year-on-year growth, the market remains sensitive to any news that could further restrict the physical flow of oil.
Investors may monitor whether these geopolitical tensions remain contained or lead to broader regional instability, as this will dictate the volatility of energy prices in the coming weeks. The next important update for markets will be further EIA inventory data and any changes in insurance premiums or tanker traffic patterns in the Red Sea, which would signal the extent of the economic impact on global energy trade.