Brent near $112 and WTI above $100 as Middle East risk premium dominates oil market

Brent crude settled at $109.76 a barrel and WTI's November contract traded near $104, with Brent having touched $110.70 in the prior session, its strongest print since May [1]. The move came even as Washington issued a temporary, 60-day waiver easing sanctions and tariffs tied to Russian energy exports, which initially pressured seaborne crude [2][3]. Markets largely looked past the waiver because Houthi forces claimed fresh strikes on Saudi energy infrastructure, including an Aramco site in Yanbu and the Shaybah oilfield, and a separate attack on a security compound in Yemen's Shabwa province killed 58 people [1][3]. A tanker also struck a sea mine in the Strait of Hormuz, and vessel-tracking data cited by Kpler showed Gulf crude exports falling to about 8.5 million barrels per day, well below prior levels [2][4].

ING strategists Warren Patterson and Ewa Manthey said oil carries a significant geopolitical risk premium and that this would only fade if Gulf flows stabilised, which they said is not yet happening [4][5]. Goldman Sachs' Daan Struyven sketched a scenario in which Brent could reach $120 a barrel if Middle East vessel attacks worsen, or fall toward $80 if exports normalise [1]. Reports of possible US-Iran talks progress remain unconfirmed, and a surprise breakthrough was flagged as a risk that could quickly reverse the gains [6]. Separately, the International Energy Agency said Russian crude output rose 65,000 barrels per day in September to 8.43 million barrels per day, still about 870,000 barrels per day below a year earlier [1][3]. For Azerbaijan, SOFAZ received 6,570.6 million manats from ACG and 564.1 million manats from Shah Deniz in January-September, with the fund's portfolio at $74.003 billion [7][8][9], showing how oil and gas revenue still anchors state finances even as prices swing on Middle East headlines.

WTI closed at $101.06, up 7.4% over the past week and 6.8% over four weeks, trading well above its rising 50-day moving average of $91.87 and 200-day average of $84.64, consistent with an established uptrend [10]. The nearest resistance sits at $106.75, with support at $88.66 [10]. Brent closed at $111.69, up 5.7% on the week, above its 50-day average of $99.41, with resistance at $112.69 and then $126.10, and support at $97.36 [10]. Both benchmarks carry daily RSI readings above 60, reflecting strong recent momentum, while the dollar index closed at 101.88, near its 52-week high, with its own rising 50-day average of $100.44 [10].

A verified de-escalation in Houthi-Saudi fighting or a confirmed, durable resolution to Strait of Hormuz tanker disruptions would reduce the geopolitical risk premium currently supporting prices [1][4][6]. A confirmed US-Iran breakthrough, rather than the unconfirmed reports circulating this week, could trigger a sharp reversal toward pre-conflict levels [6]. On the other side, a daily close by WTI below its support near $88.66, or by Brent below $97.36, would point to the current uptrend losing strength [10]. Confirmation that Washington's Russia sanctions waiver becomes permanent, adding more seaborne barrels to the market, would also weigh on prices [2][3].

Preliminary Reuters poll pointed to a decline in US crude and product inventories for the most recent week, with official EIA data due [1][3].
WTI's November futures contract was set to expire Tuesday [1][3].
Ongoing monitoring of Houthi-Saudi conflict developments and Strait of Hormuz tanker traffic.
Any formal confirmation or denial of reported US-Iran negotiation progress.
The full schedule for the week will be on the Praevis calendar page.

1. Economic Times Markets: Oil Price Today (October 20): Crude oil nears $110 again as fresh attacks outweigh easing Russian sanctions. What are experts saying?
2. DTN Progressive Farmer: Oil Prices Mixed on U.S. Sanctions Waivers, Hormuz Threats 10/19/2026
3. Economic Times Markets: Oil eases as markets assess potential waiver on Russian energy, Middle East supply risks
4. OilPrice.com: Brent Tops $110 as Tanker Attacks Threaten Persian Gulf Supply
5. FXStreet: Brent: Risk premium sustained as Middle East tensions persist – ING
6. investingLive: Crude oil surges further amid Houthis attacks on Saudi energy targets and stalled US-Iran negotiations
7. Report.az (business): Shah Deniz brings SOFAZ over 564 million manats in revenue
8. Report.az (business): SOFAZ revenue from ACG development exceeded 6.5B manats in January–September
9. Report.az (business): Value of SOFAZ investment portfolio reaches $74B
10. Daily prices: Yahoo Finance; trend, levels and RSI computed by Praevis