Oil Breaks US$100 as Middle East Conflict Threatens Global Supply

Global oil prices climbed above US$100 per barrel Wednesday as escalating attacks involving the United States, Iran and Iran-backed Houthi forces intensified concerns about energy supplies from the Middle East. Brent crude rose as high as US$101.55—its highest level since July—while West Texas Intermediate climbed above US$96. The international benchmark has gained roughly 25 per cent since early August as hopes for a lasting resolution to the six-month conflict have faded.

The latest increase followed the largest wave of attacks on oil shipping since the conflict began. Iran said it targeted 10 vessels near the Strait of Hormuz after American forces struck five Iranian tankers, while Houthi attacks damaged Saudi energy facilities and threatened shipping through the Red Sea. Oil flows through the Strait of Hormuz reportedly fell below two million barrels per day after reaching between eight million and nine million barrels per day before fighting resumed in late August.

The price surge could provide a significant revenue benefit for Alberta’s government and petroleum producers, particularly if higher prices are sustained. However, the gains come with risks for consumers and the broader Canadian economy, including more expensive gasoline, diesel and transportation, renewed inflation and pressure on interest rates. Refining constraints mean fuel prices could remain elevated even if crude prices retreat, leaving households and businesses across Alberta and British Columbia exposed to higher costs.