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Morning Oil Outlook. A Gulf Storm Pushes Brent Back Over $100

Mike Moore

Mike Moore

— 3 min read
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Morning Oil Outlook. A Gulf Storm Pushes Brent Back Over $100
Photo by Bundo Kim / Unsplash

Brent crude is back above $100 this morning. A tropical storm aimed at the Gulf Coast and more Iranian attacks on tankers near Hormuz gave traders two reasons to bid oil up, a day after the war premium (the extra cost of supply risk) looked like it was fading.

What Happened Overnight

Tropical Storm Isaias formed in the southwestern Gulf of Mexico, and forecasters expect it to become the first hurricane of the 2026 Atlantic season. The forecast has it peaking near 110 mph (Category 2) early Friday, with landfall late Friday on the northern Gulf Coast. Chevron is pulling non-essential workers from all of its platforms there, while Shell and BP are evacuating offshore staff.

That matters because those offshore fields pump about 15% of U.S. crude. Operators had already shut in (taken offline) 185,120 barrels a day as of Tuesday, or 9.24% of Gulf output. Six major refineries along the coast also sit in the storm's possible path.

KCM Trade's chief analyst called the storm "an unwelcome complication for crude, raising the prospect of production and refining disruptions at a time when the market already has enough supply-side headaches." The Middle East is supplying plenty of those. The U.K. Maritime Trade Operations agency has logged nine tanker incidents in the Strait of Hormuz so far this month, and Yemen's Houthis claimed a ballistic missile strike on King Khalid Airport in Riyadh early Wednesday.

Where Oil Stands

  • Brent (the global benchmark): $102.02, up $1.44 (1.43%), after settling Tuesday at $100.58
  • WTI (West Texas Intermediate, the U.S. benchmark): $90.645, up $1.203 (1.35%), after settling Tuesday at $89.44
  • U.S. diesel, national average: $6.302 a gallon, down from the Sept. 22 record of $6.5276

Supply is still pushing back. Saudi Arabia's East-West pipeline moves 5.8 million barrels a day to the Red Sea, bypassing Hormuz. Persian Gulf crude flows outside Iran also recovered to about 91% of pre-war levels in September.

Diesel is the weak spot. East Coast distillate stocks (diesel and heating oil) sit 32% below their five-year seasonal average, so a refinery outage would hit a market with little cushion.

What to Watch Today

The Energy Information Administration (EIA) releases its weekly inventory report at 9:30 a.m. Central. Industry data from the American Petroleum Institute showed crude stocks fell 2.09 million barrels in the week ending Oct. 2, and traders want to see if the government numbers agree. The International Energy Agency also meets today to discuss emergency stock releases, including the G7's plan for up to 100 million barrels.

After that, it's all about the storm. The latest forecast shifted Isaias east toward Alabama and the Florida Panhandle, and its path will decide how much offshore output goes dark. Friday also brings the Baker Hughes rig count, a weekly tally of active drilling rigs.

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