Brent crude oil prices surged above $100 per barrel for the first time since May, driven by escalating tensions in the Middle East and mounting supply risks, according to ING analysts Warren Patterson and Ewa Manthey [2]. The analysts highlight that threats to oil flows through the Strait of Hormuz and the Red Sea, as well as disruptions to Kazakh exports from the CPC terminal in Russia, have put a significant amount of global oil supply at risk [2]. In June, Saudi crude oil exports from Yanbu in the Red Sea averaged roughly 4.6 million barrels per day, while recent export volumes from the CPC terminal have exceeded 1.7 million barrels per day [2]. Houthi attacks on Saudi vessels in the Red Sea and alleged Ukrainian attacks on tankers have further exacerbated concerns [2].
The ING report notes that with little sign of de-escalation, oil prices are likely to continue rising, with $120 per barrel identified as a potential trigger for increased US political pressure to negotiate [2]. The analysts suggest that pressure on the Trump administration to de-escalate could intensify if Brent approaches this level, while Iran may seek to push prices higher despite the risk of a collapse in oil revenues due to the US blockade [2].
The spike in oil prices has had a notable impact on the precious metals market. According to OCBC’s Sim Moh Siong and Christopher Wong, gold was unable to sustain its recent rebound, falling back toward $4,040–$4,050 after briefly trading above $4,160 in the previous session as Brent broke above $100 and both the US dollar and US yields moved higher [1]. The analysts observe that gold’s tentative recoupling with geopolitical risk remains fragile, with the metal trading mainly through the oil and rates channel and facing two-way risks around nearby support and resistance levels [1]. Losses were broad-based across the precious metals complex, including silver, platinum, and palladium [1].
Technical analysis from OCBC indicates mild bullish momentum for gold remains intact on the daily chart, but the RSI has fallen, suggesting two-way risks. Key resistance levels are identified at $4,070 (21 DMA) and $4,167, with support at $4,000 and $3,960 [1].
CONCLUSION
Escalating geopolitical tensions have driven Brent crude above $100, with analysts warning of further upside risk in oil prices if the situation does not de-escalate. The surge in oil and higher US yields have capped gold's rebound, leaving the precious metals complex under pressure and highlighting the market's sensitivity to ongoing developments.