Oil extends gains to near six-week highs on new Middle East supply risks
The sun sets behind oil pumps outside Vaudoy-en-Brie, near Paris, France, March 18, 2026—REUTERS
Oil prices extended gains to trade near six-week highs on Wednesday as fears of further supply disruptions intensified after US forces struck Iranian military targets for the 11th straight night, while oil tankers made U-turns in the Red Sea after warnings by the Iran-backed Houthi militia.
Brent crude futures rose $1.84, or 2.0%, to $92.85 a barrel, the highest since June 11. US West Texas Intermediate crude climbed $1.67, or 2%, to $86.01, its highest since June 12.
The gains came after oil settled at a five-week high on Tuesday in the wake of US forces striking targets in southern and western Iran, while Iran attacked US facilities in Bahrain, Kuwait and Jordan.
The US military said it began its latest strikes on Iran late on Tuesday in the United States, or early Wednesday in Iran. The US attacks came a short while after the Kuwaiti army said its air defences were intercepting Iranian drones on Wednesday.
The constant trading of strikes has raised fears of further disruptions to global energy supplies after Yemen's Iran-aligned Houthis opened a new front in the Iran war by threatening to target vessels carrying Saudi oil in the Bab el-Mandeb Strait and announcing a naval blockade of Saudi Arabia.
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The Bab el-Mandeb waterway at the southern entrance to the Red Sea has become an increasingly important route for Saudi Arabian crude exports as traffic through the Strait of Hormuz has fallen sharply since a ceasefire between the United States and Iran collapsed earlier this month.
Three oil tankers loaded with Saudi crude for China and India made U-turns in the Red Sea on Tuesday, heading towards the Suez Canal rather than braving the Yemeni coast following a warning from Yemen's Iran-aligned Houthi militia.
"This would force tankers to enter and exit the Red Sea via the Suez Canal, adding significant time and expense to voyages to Asia," said ING commodity strategists on Wednesday, adding that tensions in the Black Sea also added to supply uncertainty.
The Caspian Pipeline Consortium has stopped receiving oil from Kazakhstan after suspending loadings on Monday due to attacks on oil tankers at its Black Sea terminal blamed on Ukrainian drones. Ukraine has not commented on the attacks.
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"The longer the suspension drags on, the greater the likelihood that Kazakhstan will be forced to curb upstream production," said ING.
Data from the American Petroleum Institute showed that US crude and distillate inventories rose last week, while gasoline stockpiles fell, market sources said. The inventory data comes ahead of official figures from the US Energy Information Administration on Wednesday.