Oil prices hit five-month high as attacks in Saudi Arabia and Strait of Hormuz threaten supply

Brent crude rises 3% to $112 a barrel after Houthi strikes and Iranian Revolutionary Guard hits on tankers; US orders diplomats to leave Saudi Arabia

By LineZotpaper

Published22 October 2026

Read Time3 min

Oil prices surged to a five-month high on Thursday after attacks in Saudi Arabia and strikes on tankers near the Strait of Hormuz raised fears of further disruptions to global crude supply. Brent crude, the international benchmark, rose 3% to $112 a barrel, its highest since mid-May, as markets reacted to the escalation of hostilities in the region.

Yemeni Houthi fighters, aligned with Iran, struck several targets in Saudi Arabia on Wednesday. Two people were killed and eight wounded in an attack on a civilian airport in Dammam, while a drone strike on a Saudi oilfield killed two more, according to reports.

Separately, Iran's Islamic Revolutionary Guard Corps (IRGC) said its forces tracked and hit four vessels involved in what it called "illegal" oil transfers in the northern Gulf, setting them on fire. The IRGC added that three more vessels struck mines west of the Strait of Hormuz and warned the United States that continued provocations could lead to a broader response against its regional bases.

In response, the United States has ordered some diplomats and family members to leave their missions in Saudi Arabia and plans to withdraw family members from other Middle East posts, Reuters reported. Saudi Aramco also instructed staff to vacate its Dhahran headquarters and work remotely.

The attacks come nearly eight months after Tehran effectively blocked the Strait of Hormuz, triggering what many feared would be the greatest energy supply disruption in history. Oil surged past $100 a barrel in the weeks after US-Israeli strikes on Iran and peaked at $126 in April. It fell back below $100 in late May and dropped to $71 in early July amid hopes for a ceasefire. Prices began climbing again after a memorandum of understanding between the US and Iran collapsed and fresh hostilities broke out in the Gulf.

Despite the turmoil, data from Kpler shows Persian Gulf oil exports have now risen above prewar levels, partly due to increased overland pipeline flows to the Red Sea and Gulf of Oman.

Global stock markets slumped on Thursday amid expectations of higher inflation and borrowing costs. The Stoxx Europe 600 fell 1%, the UK's FTSE 100 dropped 0.7%, Japan's Nikkei 225 lost 2.7%, South Korea's Kospi fell 3.5%, and Hong Kong's Hang Seng shed 3%. American Airlines shares slid almost 4% in pre-market trading after the carrier warned that "historic fuel cost pressure" would push it into a loss this year, abandoning a prior forecast of possible profit.

Analysis

Why This Matters

Rising oil prices feed directly into inflation, hitting consumers and businesses worldwide through higher fuel and transport costs.
The Strait of Hormuz chokepoint remains a critical vulnerability for global energy markets; a sustained disruption could force central banks to keep interest rates high.
Escalation between Iran-aligned forces and the US-Saudi coalition risks drawing in more regional players and further destabilizing the Gulf.

Background

The current crisis stems from the US-Israeli strikes on Iran earlier this year, which prompted Tehran to block the Strait of Hormuz. Oil surged past $100 a barrel and peaked at $126 before falling back amid ceasefire hopes. A US-Iran memorandum of understanding briefly calmed markets, but its collapse led to renewed hostilities. Overland pipeline capacity has partially offset sea route disruption, keeping some exports flowing.

Key Perspectives

Iran-backed Houthis and IRGC: Frame their actions as a response to "illegal" oil transfers and continued US provocations, warning of wider strikes on regional bases. United States and Saudi Arabia: View the attacks as a direct threat to civilian lives and critical infrastructure; evacuation of diplomats signals concern about further escalation. Global markets: Prices reflect persistent supply risk; stock falls show investors pricing in higher energy costs and slower economic growth.

What to Watch

The trajectory of Brent crude: a break above $115 or $120 would signal deeper disruption.
Whether the US launches retaliatory strikes or works through diplomatic channels to de-escalate.
Pipeline capacity from the Gulf to the Red Sea: if output continues rising, it may cushion the oil price spike.

Sources

Oil prices jump to five-month high as attacks threaten global supply · World news | The Guardian

Checked

11 claims in this story checked against 1 source: 7 supported.

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SupportedAttacks in Saudi Arabia and hits to tankers near the Strait of Hormuz threatened global crude supply.World news | The Guardian: “Oil prices jumped to a five-month high on Thursday after attacks in Saudi Arabia and hits to tankers in the strait of Hormuz threatened further disruptions to the world’s crude supply.”
SupportedBrent rose 3% to $112 a barrel, its highest since mid-May.World news | The Guardian: “Brent crude, the international benchmark for oil prices, rose by 3% to hit $112 a barrel for first time since 18 May.”
Partly supportedThe summary describes Iranian Revolutionary Guard hits on tankers.World news | The Guardian: “the Iranian Islamic Revolutionary Guard Corps (IRGC) said four vessels involved in “illegal” oil transfers in the northern Gulf were hit and caught fire after being tracked by its forces on Wednesday.”
SupportedTwo people were killed and eight wounded at a civilian airport in Dammam, and two more were killed in a drone attack on a Saudi oilfield.World news | The Guardian: “with two people killed and eight more wounded in a civilian airport in Dammam, and two people killed in a drone attack on a Saudi oilfield.”
SupportedThe IRGC said its forces tracked and hit four vessels involved in illegal oil transfers, which caught fire.World news | The Guardian: “the Iranian Islamic Revolutionary Guard Corps (IRGC) said four vessels involved in “illegal” oil transfers in the northern Gulf were hit and caught fire after being tracked by its forces on Wednesday.”
SupportedThe IRGC said three more vessels struck mines west of the Strait of Hormuz.World news | The Guardian: “It said three more vessels collided with mines west of the strait of Hormuz”
SupportedThe United States ordered some diplomats and family members to leave missions in Saudi Arabia and plans to withdraw family members from other Middle East posts.World news | The Guardian: “The US has now ordered some diplomats and family members to leave their missions in Saudi Arabia, and it plans to withdraw family members from a number of other missions in the Middle East, according to Reuters”
Partly supportedTehran’s effective block of the Strait nearly eight months earlier triggered fears of the greatest energy supply disruption in history.World news | The Guardian: “almost eight months after Tehran’s effective block on the strait of Hormuz triggered what many feared would bring the greatest energy supply disruption in the history of the market.”
SupportedPersian Gulf oil exports have risen above prewar levels, partly because of increased overland pipeline flows.World news | The Guardian: “data from Kpler has shown that oil exports from the Persian Gulf have now risen above their prewar levels, partly because of an increase in oil pumped overland through pipelines to the Red Sea and Gulf of Oman.”
Partly supportedGlobal stock markets slumped on Thursday.World news | The Guardian: “Global stocks wobbled on Thursday amid expectations of higher inflation and borrowing costs.”
Partly supportedAmerican Airlines warned that “historic fuel cost pressure” would push it into a loss this year.World news | The Guardian: “Shares in American Airlines dropped almost 4% in pre-market trading after the company warned that high fuel costs would push it into a loss this year. American Airlines abandoned its previous forecast that it might achieve a profit this year as it faced “historic fuel cost pressure”.”