Oil prices rose above $110 a barrel on Tuesday as renewed attacks in the Middle East outweighed the prospect of easier Russian energy exports, keeping Brent near a five-month high.
Brent futures gained 0.5% to $110.10 by 0319 GMT, after reaching $110.70 on Monday, their highest since May 20.
US West Texas Intermediate for November delivery rose 0.24% to $103.91, while the more actively traded December contract climbed 0.4% to $98.93. The November contract expires on Tuesday.
Russia relief has limits when Gulf shipping is under threat
President Donald Trump’s October 16 executive order waived sanctions and tariffs under the newly enacted Graham Act, including penalties associated with buying Russian oil and gas.
It did not remove every existing restriction on Russian energy, and Washington is reviewing the implications of its decision.
Lifting a threatened trade penalty does not immediately increase Russian production. It may instead protect existing flows and make purchases less risky for importing countries.
Russian output reached 8.43 million barrels a day in September, still about 870,000 barrels below a year earlier, according to International Energy Agency figures.
That makes the waiver a source of possible relief rather than a guaranteed supply surge.
Attacks around the Gulf keep a premium in Brent
Yemen’s Houthi movement claimed fresh attacks on Saudi energy and transport facilities on Monday, including targets in Yanbu and Shaybah. Saudi authorities had not independently confirmed those particular claims.
Shipping is already under pressure. Market data indicated at least 18 vessels were attacked in the Gulf over the preceding fortnight, intensifying fears around the Strait of Hormuz.
Analysts warned that efforts to restore oil flows may not stabilise fuel markets while regional threats escalate.
Traders are pricing in more than lost production. Higher insurance, freight costs and the risk of another closure can keep delivered oil expensive even when exporters find alternative routes.
The same uncertainty explains why Brent recovered so quickly from the decline after Trump’s announcement.
Goldman sees $90 Brent, but only if supply keeps recovering
The longer-term forecast is less bullish. Goldman Sachs Research expects Brent to reach $90 in December and average $80 in 2027 as Gulf exports recover and slower demand brings the market towards surplus.
Daan Struyven, Goldman’s head of oil research, said in the bank’s October 16 analysis that supply adaptation should eventually lower prices, although renewed escalation could delay that adjustment.
Goldman estimates a geopolitical premium of nearly $25 a barrel in physical spot Brent prices, not necessarily the same premium in the futures contract quoted on Tuesday.
It also estimates Gulf exports have returned close to their 2025 average, including less visible shipments.
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