Oil Prices Rise Over $2 as Saudi Refinery Attack Claim Fuels Supply Fears
Oil prices rose by more than $2 on Wednesday, October 28, 2026, as a reported missile attack on a Saudi Arabian refinery renewed concerns about Middle East energy supplies. Investors were also monitoring U.S. crude inventories and the upcoming OPEC+ production meeting.
Brent crude futures climbed $2.02, or 1.8%, to $115.90 a barrel as of 0735 GMT. U.S. West Texas Intermediate (WTI) crude gained $2.01, or 2.0%, to $101.91 a barrel. The gains followed declines of nearly $2 in the previous session.
Unconfirmed Refinery Strike Raises Supply Concerns
According to Reuters, Yemen’s Iran-aligned Houthis said on Tuesday that they had struck Saudi Arabia’s largest oil refinery with a missile. Saudi authorities had not immediately confirmed the claim concerning the facility, which has a processing capacity of approximately 550,000 barrels per day.
The reported attack heightened concerns about the vulnerability of energy infrastructure. However, the claim alone did not establish damage, an operational shutdown or a confirmed loss of supply.
Oil prices reflected concern about potential disruption as traders awaited further information on the facility and the broader conflict.
Geopolitical Risk Premium Supports Oil Prices
ING commodity strategists said markets were pricing in a greater likelihood of renewed escalation. Uncertainty surrounding U.S. President Donald Trump’s next steps towards Iran continued to support the geopolitical risk premium embedded in oil prices.
The strategists suggested that the premium could begin to decline if the election period passed without renewed strikes on Iran. That assessment remained conditional on subsequent political and military developments.
Further escalation could support oil prices, while credible signs of de-escalation could ease supply concerns. The scale of any market response would depend partly on whether developments affected actual production, refining or transport flows.
API Inventory Draw Shifts Attention to Official U.S. Data
U.S. crude inventories fell by approximately 2.03 million barrels in the week ended October 23, according to market sources citing American Petroleum Institute data.
The reported draw contrasted with expectations for an increase of roughly 15,000 barrels in a Reuters analyst survey. Investors were awaiting the Energy Information Administration’s official weekly report, scheduled for later on Wednesday.
The API estimate and EIA report are separate releases and may differ. The official figures could provide additional direction for oil prices as traders assessed U.S. inventory conditions.
OPEC+ Expected to Maintain December Production Targets
OPEC+ producers were expected to keep December output targets unchanged at their meeting on Sunday, November 1, according to sources familiar with the discussions. This remained an expectation ahead of the meeting.
Production across most of the seven participating core members—Saudi Arabia, Russia, Iraq, Kuwait, Algeria, Kazakhstan and Oman—was reported to be below their respective targets. Actual output therefore remained relevant alongside announced production policy.
Separately, traders said Russian crude exports from Baltic and Black Sea ports could decline in November as domestic refineries increased diesel production following a reported agreement with Washington earlier in October.
Market Outlook: Supply Developments Remain Central
Oil prices were likely to remain sensitive to confirmation of the refinery’s operating status, developments involving Iran, U.S. inventory data and OPEC+ guidance.
Confirmed supply disruptions or further escalation could add upward pressure. Conversely, easing tensions or stronger-than-expected inventory builds could weigh on oil prices as investors reassessed supply risks.