Brent crude futures on the ICE exchange in London traded above $100 per barrel on September 9, reaching $100.40 during the session, the first time since July 24, according to The Bell.
The price surge follows fresh escalation around the Strait of Hormuz. On September 8, the US Central Command (CENTCOM) said it destroyed five Iranian oil tankers in response to attempts by the Islamic Revolutionary Guard Corps (IRGC) to attack a US Navy vessel with ballistic missiles. Iran later reported strikes on two American ships and eight tankers, and the IRGC said it hit ten more vessels that, according to Tehran, tried to pass through the strait, which Iran has declared closed.
ING analysts said the latest events confirm that a return to peace talks is far off, and prices will retain a significant geopolitical risk premium. Goldman Sachs warned that if attacks on ships intensify, Brent could rise to $120 per barrel. The bank's base forecast for December is $85 per barrel, and $80 if Gulf exports normalize.
The escalation in the region has lasted six months, and since early August Brent quotes have risen about 25%. Economist Yegor Susin said a "tanker war" has effectively begun in the Persian Gulf, with sides striking vessels, of which there are about 80: "in such a situation, any traffic will only be 'on the way out'." According to his data, prices for physical deliveries already exceed futures: Dated Brent cost $106.5 per barrel on Monday, and Oman/Dubai quotes have stayed above $100 for the past three days.
Rising prices bring additional petrodollars to the Russian budget. Susin wrote that the average Urals price for tax calculation rose above $82 per barrel. The ruble is strengthening against this backdrop: on the Moscow Exchange, the yuan/ruble pair fell to 12.69, the first time since August 27, and the non-deliverable dollar/ruble pair traded near 85.43, also close to two-week highs.
The ruble is also supported by geopolitical optimism after talks between Vladimir Putin and Donald Trump, Reuters notes: local markets have begun to price in the possibility of resuming Moscow-Kyiv negotiations and easing sanctions. Additional support comes from reduced currency interventions by the Bank of Russia — the regulator buys currency at 1.9 billion rubles per day, three times less than previous operations.
Against the ruble are increased import flows and risks of reduced physical exports of Russian oil due to strikes on port infrastructure in the Black Sea, Reuters' Moscow bureau points out. Ukrainian strikes on Russian ports and tankers also pressure supply: Russia can no longer compensate for refining losses by increasing crude exports.