Brent Crude Rallies Past $94, Eyes $100 on War Escalation

Brent crude pushed above $94 a barrel on Wednesday, extending gains. The Middle East conflict showed no signs of easing. The front-month contract has rallied more than 12% since the start of October, with traders pricing in a prolonged disruption to shipments through the Strait of Hormuz.

The strait, a chokepoint for about a fifth of global oil consumption, remains effectively closed to commercial traffic. Chris, a senior analyst at FXEmpire and a proprietary trader, said the closure is putting pressure on markets. Short-term pullbacks are possible, he said. The market remains impulsive in its moves.

The U.S. Strategic Petroleum Reserve is within weeks of hitting a minimum operating level, Chris said. Other countries are in a much worse position, he added. The supply shortfall from the Middle East has not been fully offset by other producers.