Oil rebounded up to 4% as Hormuz tanker fires and Saudi alerts stall post-election sell-off

Global crude oil futures jumped on Thursday as fresh tanker attacks in the Strait of Hormuz, Saudi security alerts in Yanbu, and a Ukrainian drone strike on a Russian refinery checked post-midterm peace bets.

Crude benchmarks staged a sharp recovery on Thursday, clawing back part of Wednesday's 8% slump as physical disruption risks resurfaced. January Brent surged $3.67, or 3.88%, to settle at $98.29 a barrel, while WTI rose $2.40, or 2.72%, to reclaim $90.52, stretching the transatlantic spread to $7.77.

Escalating maritime hostilities across the Persian Gulf halted the post-election liquidation. Iran's Revolutionary Guards confirmed two oil tankers and a tugboat caught fire in the Strait of Hormuz, while the UKMTO reported at least five vessel incidents since Sunday. Upstream anxiety deepened after Saudi Arabia issued danger alerts for its Yanbu export terminal and Houthis claimed strikes on Dammam's King Fahd airport.

Traders quickly reassessed the durability of diplomatic overtures. Gelber & Associates warned against pricing in normalised flows before transit corridors stabilise, while Citi noted the White House retains broad executive authority to escalate military action post-midterms. Product balances tightened further after Ukrainian drones struck Russia's major Ryazan refinery, threatening Moscow's diesel export commitments..