Crude oil hits 8-week high as Brent crosses $100 per barrel mark; How Red Sea has emerged as a new front in West Asia conflict | Explained

Crude oil futures jumped nearly 6 per cent in the domestic market in Thursday trading, driven by global benchmark Brent oil reclaiming the $100 per barrel mark, its highest level in eight weeks, as tensions intensified across West Asia. US crude also surged for a second straight session, climbing more than 5 per cent to nearly $92 per barrel, the highest since June 11.

Crude crosses $100 per barrel mark: Reason that led to the price hike

Market analysts noted that the growing escalation around the Red Sea corridor has reignited serious concerns regarding fresh disruptions to global energy supply chains.

Yemen's Iran-backed Houthi rebels said early Thursday said they had attacked two Saudi oil tankers in the Red Sea, and the U.S. military conducted a 12th night of strikes against Iran as the two countries vie for control of vital shipping lanes.

The Houthi attack in the Red Sea threatened to open a new front in a war that has roiled the global economy, sending prices for fuel and other goods surging across the world. With the standoff in the Gulf deepening, there were no signs of progress in diplomatic efforts to end the conflict.

How Red Sea has emerged as a new front in West Asia conflict

These recent incidents appear to signal a broader expansion of the regional conflict. Prior to this, targeted maritime attacks had been primarily concentrated around the Strait of Hormuz since the onset of the war with Iran. The latest reported strikes indicate that operational threats are extending directly into the Red Sea, effectively opening another critical front for global oil markets to monitor.

The Red Sea route remains a vital artery for global energy trade, with millions of barrels of oil passing through the Bab el-Mandeb strait daily to reach destinations across the globe. Beyond energy shipments, the waterway accounts for roughly 12 per cent to 15 per cent of total global trade, representing over $1 trillion in annual cargo value.

Crucially, the route had served as an essential alternative bypass for shippers navigating the persistent traffic disruptions in the Strait of Hormuz. However, passage through Hormuz severely deteriorated on Tuesday, with total ship crossings plummeting into the single digits.

Against this backdrop of escalating maritime risks, benchmark oil prices have surged by approximately 35 per cent since the start of the month and stand more than 60 percent higher so far this year.

On the Multi Commodity Exchange (MCX), crude oil futures for August delivery surged by Rs 477, or almost 6 per cent, to trade at Rs 8,887 per barrel.

Traders noted that fresh buying momentum accelerated after renewed attacks in the Red Sea heightened anxieties over potential disruptions to energy exports out of the Gulf nations.

In a post on Truth Social, US President Donald Trump said, "Now they (Houthis) are starting up again, shooting at two Saudi Arabian ships last night. Please let this TRUTH serve to represent that if they do this again, the US will hold Iran responsible."

Crude oil highest since May 15

In international markets, Brent crude for September delivery spiked by $6.16, or nearly 7 per cent, to $100.23 per barrel, crossing the psychological $100 mark for the first time since May 15, 2026, when it touched $100.32 per barrel.

In the overseas markets, Brent crude for September delivery soared USD 6.16, or nearly 7 per cent, to USD 100.23 per barrel, reclaiming the USD 100 mark for the first time since May 15, 2026, when it traded at USD 100.32 per barrel.

Similarly, West Texas Intermediate (WTI) crude for September contract also climbed $4.22, or 5 per cent, to $91.05 per barrel on the New York Mercantile Exchange (NYMEX).

Analysts highlighted that Brent, which soared to $126 per barrel during the peak of the conflict in April before cooling to around $71 earlier this month, has mounted a steep rebound driven by resurfacing geopolitical risks.

Crude oil has now recorded its fastest monthly gain since earlier Gulf export disruptions through the Strait of Hormuz, as the broader regional conflict entered a significantly more dangerous phase over the last 24 hours.

According to market analysts, Yemen's Houthi movement has escalated actions from threatening a blockade on Saudi Arabia to actively targeting two Saudi oil tankers in the Red Sea, compromising a vital alternate export artery that Riyadh relies on to bypass the Persian Gulf.

Adding to the tensions, the US military carried out airstrikes against targets in Iran for a 12th straight night on Wednesday, prompting Tehran to retaliate with strikes against US-linked military facilities in Kuwait and Jordan.

Meanwhile, global investment bank Goldman Sachs has warned that Brent crude prices could surge toward $120 per barrel by the end of the year if oil shipments through the critical Strait of Hormuz are not fully restored.

(With inputs from agencies)