Post #15901

Oil Surges 8%: What Happened? Oil is pushing to fresh highs, with WTI trading near $76 and up 8% from the prior session. Oil is rising because the situation has escalated at key energy hubs. Aramco halted operations at Ras Tanura, Saudi Arabia’s largest refinery, after a drone strike, and debris from another intercepted drone triggered a major fire at the UAE’s Fujairah oil hub. Even though Fujairah resumed normal operations, these incidents reinforce the same message: the market is focused on disruption risk, and that is what is driving oil higher. The biggest driver is not an official closure of the Strait of Hormuz—it’s the fact that traffic through it has largely stalled anyway. Even without a formal shutdown, reduced tanker movement and insurers pulling war-risk coverage are enough to tighten supply expectations and force a risk premium into crude. - Alan