Brent Crude Tops 106 Dollars as API Data Shows Massive Inventory Draw and Iran Intensifies Tanker Attacks

Oil prices surged to their highest levels in two weeks on Wednesday as a confluence of supply threats pushed Brent crude above 106 dollars per barrel and WTI to roughly 95 dollars. November WTI futures closed up 0.95 dollars, or 1.01 percent, while RBOB gasoline added 0.094 dollars, or 0.29 percent, extending a rally that has built throughout the week.

The single most striking data point driving Wednesday's move was the American Petroleum Institute's weekly inventory report, which showed a draw of 11.12 million barrels in U.S. crude stocks. That figure was dramatically larger than the forecast build of 1.9 million barrels and dwarfed the prior week's draw of 2.09 million barrels. Cushing, Oklahoma hub stocks bucked the trend, rising by 1.823 million barrels, but the headline draw signaled tighter-than-expected overall supply.

Geopolitical pressure compounded the inventory shock. Iran has intensified attacks on tankers in the Strait of Hormuz, raising fears of a direct disruption to one of the world's most critical energy chokepoints. Strikes involving Russia have added a separate threat vector to global supply chains, while rising shipping costs are flowing through to fuel markets globally. Analysts note that verbal interventions that previously calmed traders, including statements about peace talks and a brief June ceasefire, are no longer sufficient to move prices as underlying fundamentals reassert control.

OPEC's latest forecast of stronger demand growth for next year has added further upward pressure, leaving markets with tightening inventories, active conflict around key shipping lanes, and a demand outlook that offers little near-term relief.