Oil Prices Climb as Brent Tops $114 and WTI Holds Above $100 After Houthi Attacks Force Aramco to Evacuate HQ

Oil prices rose again on Friday, with the global benchmark Brent crude climbing above $114 a barrel and U.S. crude holding above $100, as escalating attacks on Saudi Arabia by Yemen's Houthi rebels and fears of renewed conflict with Iran heightened concerns about Middle East supply.

Brent crude rose $1.21, or 1.07%, to $114.40 a barrel, extending the previous session's roughly 4% surge, which had lifted the benchmark to its highest settlement in five months. U.S. West Texas Intermediate crude gained $1.39, or 1.4%, to $100.90 a barrel.

Brent was on track for a third consecutive weekly gain.

Aramco evacuates headquarters

The latest rally followed a sharp escalation in fighting between Saudi Arabia and the Iran-aligned Houthis. Saudi Aramco, the world's largest oil company, ordered staff to evacuate its headquarters in Dhahran, in the kingdom's oil-rich Eastern Province, and to work from home.

Saudi civil aviation authorities said one person was killed and eight injured in an attack on King Fahd International Airport in eastern Saudi Arabia. A drone aimed at an Aramco facility at Shaybah was intercepted.

Analysts said the attacks suggested the Houthis now have the ability to strike deeper into Saudi Arabia, beyond their earlier focus on the Red Sea and the kingdom's western ports. The Houthis have also pushed toward the Bab al-Mandab Strait, a key shipping chokepoint at the southern end of the Red Sea.

Iran tensions in focus

Investors were also watching rising tensions with Iran. Iran's Revolutionary Guard navy claimed it struck four vessels involved in what it called illegal oil transfers in the northern Persian Gulf, and said three more ships hit mines west of the Strait of Hormuz. Those claims could not be independently verified.

President Donald Trump accused Iran of "making up fake hits" to drive up oil prices ahead of the U.S. midterm elections next month, according to media reports.

"Markets are increasingly worried about renewed escalation in the Persian Gulf," ING analysts Warren Patterson and Ewa Manthey wrote in a note.

"Reports suggest President Trump is considering fresh strikes on Iran," they wrote, adding that the United States was reportedly reinforcing its military presence in the region with a second aircraft carrier.

ING said renewed escalation would undercut hopes for a de-escalation after the U.S. midterms. The bank said its earlier forecast for Brent to average $80 a barrel in the fourth quarter was now unattainable and raised its outlook.

Libya supply loss

Supply disruptions outside the Gulf added to the upward pressure. Libya's National Oil Corporation said a pipeline carrying crude from the Hamada and Tahara fields to the Zawiya export terminal had been shut, cutting production at both fields.

Libya, a member of OPEC, has frequently faced supply disruptions due to political instability and local disputes.

Russia-Ukraine talks

Partially offsetting the supply concerns, Russia said it was ready to resume U.S.-mediated peace talks with Ukraine next month. Western sanctions on Russian energy exports have helped push oil prices higher, and any progress toward a peace deal could eventually ease supply concerns.

Impact on markets

The surge in oil prices has rippled across financial markets. Higher energy costs have revived fears of inflation and raised expectations that the U.S. Federal Reserve may need to keep interest rates higher for longer.

The Fed raised rates last month for the first time since 2023, and investors are watching its policy meeting on Oct. 27-28 for further signals. Traders see a possible increase in December.

Higher oil prices also weighed on gold, which fell toward its lowest level in nearly three months, and contributed to a broader risk-off mood that hit technology stocks and cryptocurrencies.

Consumers feel the pinch

For consumers, higher crude prices typically translate into higher gasoline and diesel prices within weeks. U.S. crude above $100 a barrel is likely to put pressure on fuel prices just as the country heads into the midterm elections, making energy costs a politically sensitive issue.

Airlines, shipping companies and other energy-intensive industries also face rising costs, which could be passed on to customers.

What's next

Oil traders will remain focused on developments in the Middle East, particularly the conflict between Saudi Arabia and the Houthis and the risk of renewed U.S. or Israeli strikes on Iran.

Any disruption to shipping through the Strait of Hormuz, through which a large share of the world's seaborne oil passes, could send prices sharply higher. On the other hand, signs of de-escalation or progress in Russia-Ukraine peace talks could ease supply concerns.

Investors will also watch U.S. inventory data and next week's Fed meeting for clues on demand and the economic outlook.