Brent crude breaks $117 as Iran targets Gulf data centers

Brent crude briefly surpassed $117 per barrel on Friday, marking the highest price point since April. The international benchmark for oil trading surged by approximately 3.5 percent during the session. Although the price retreated slightly in the final hours of trading, it still settled at just over $116 per barrel, representing a gain of more than 2.7 percent from the previous close.

The price spike followed specific threats from Iranian officials regarding potential retaliation against a new joint US-Israeli offensive. Tehran indicated it would target oil facilities, undersea cables, data centers, and artificial intelligence infrastructure within the Gulf region. Market analysts attribute the immediate volatility to widespread reports that the United States is considering renewed military strikes on Iran. These plans are reportedly timed for the period following the midterm elections, signaling a shift away from a purely diplomatic strategy.

Richard Hunter, a broker at Interactive Investor, stated that this strategic shift was sufficient to trigger the price spike. He noted that the conflict, which many initially viewed as brief, is now entering its eighth month. To contextualize the current costs, Brent crude was trading at approximately $72 per barrel in February before the war with Iran began. By the end of April, tensions had already driven the price to touch $126 per barrel.

Regional instability intensified earlier in the week when the Islamic Revolutionary Guards Corps claimed responsibility for striking four commercial ships in the Strait of Hormuz. This strait serves as a critical chokepoint for global oil shipments. Recent incidents have made navigation through the area increasingly risky for commercial vessels. In response to the rising instability, the US State Department ordered some diplomats and the families of US government employees to leave Saudi Arabia.

Susannah Streeter, chief investment strategist at Wealth Club, observed that fears are mounting that American and Israeli forces may target Iran’s energy infrastructure after the US elections on November 3. She pointed out that attacks on Saudi Arabian facilities by Houthi rebels based in Yemen have intensified this week. Streeter added that the journey across the Strait of Hormuz remains dangerous for ships due to projectiles still being fired at maritime traffic.

Other global factors are also contributing to supply concerns. Streeter noted that Ukraine’s bombardment of Russian diesel refineries is impacting the global energy supply chain. This additional pressure on refineries is complicating an already volatile market environment as traders assess the risk of further disruptions to global energy flows.