Brent Above $108: Red Sea Risks and Fuel Price Pressures — NRG-IA

Brent crude was trading on Friday, September 11, at $108.44 per barrel at 06:45 Romanian time , following a surge of over 6% in the previous session. Futures prices reflect a market grappling with expanding threats to maritime shipping, while transit through the Strait of Hormuz remains severely restricted. Reuters . The escalation in the Red Sea is putting pressure on one of Saudi Arabia's alternative export routes. Crude loaded at the port of Yanbu can reach international markets by bypassing Hormuz, but the widening conflict along the Yemeni coast increases risks for regional shipping. For buyers, supply security and continuity are becoming critical in a market already strained by production outages. Reuters reports that Houthi rebels captured the Yemeni port of Mocha on Thursday, according to military sources from the Yemeni government. Their advance amplifies threats to Saudi exports through the Red Sea. The group claims that shipping remains safe except for Saudi vessels—a statement from a party to the conflict that highlights the selective nature of the threat. Reuters, as carried by Business Recorder . Geography dictates the exposure of each route. Yanbu is located on the Saudi Red Sea coast, north of Bab el-Mandeb. Vessels departing from here for Europe via the Suez Canal sail northward, while those bound for the Indian Ocean must transit the southern strait. Consequently, threats to Bab el-Mandeb impact Saudi export destinations differently. Reuters, Bab el-Mandeb explainer . Traffic data highlights the varying scale of disruptions. For September 10, Kpler identified seven transits through Hormuz , compared to a 10-day daily average of 15. Meanwhile, 26 commercial cargo vessels transited Bab el-Mandeb, close to the recent average of 27. The data cited by Reuters tracks vessels visible via the Automatic Identification System (AIS) and may omit shipments with transponders turned off. They indicate severe restrictions in Hormuz alongside continued traffic through Bab el-Mandeb. Reuters . Loadings from Yanbu also continue. Vortexa estimates cited by Reuters indicate approximately 3.7 million barrels per day of crude and condensate in early September , up from 3.2 million in August. This trend underscores the route's role in sustaining Saudi exports and explains why any deterioration in its security could significantly impact global supply. Reuters . Military pressure is compounding already significant production outages. The US Energy Information Administration (EIA) estimates that unplanned outages in the Middle East reached 6.7 million barrels per day in August, up from 5 million in July. This estimate is from the forecast published on September 9, compiled using data available up to September 3, prior to the latest escalation in Yemen. EIA . Competition for alternative sources is extending beyond the region. Independent Chinese refiners have purchased over 20 million barrels from West Africa, Canada, and South America in recent weeks, according to estimates from two traders cited by Reuters. This scramble for replacement cargoes could intensify competition between Asian and European buyers for crude available from the same regions. Reuters . For fuels, pressure extends beyond the crude market. Diesel depends on refinery runs, export availability, and inventories in consuming regions. The EIA identifies supply constraints for petroleum products from the Middle East, Russia, and China, at a time when refinery maintenance and seasonal demand could add further strain. EIA . US distillate inventories, a category that includes diesel, illustrate this vulnerability. In the week ending September 4, they stood at 106.3 million barrels , approximately 13% below the five-year average for this time of year . A weekly increase of 2.1 million barrels improved the situation, but stock levels remain low compared to the seasonal benchmark. EIA, weekly report . This gap between crude availability and refined fuel supply could prolong price increases. A pullback in Brent prices would ease one cost pressure, but diesel trends would remain dependent on inventory replenishment and finished product deliveries. For hauliers and farmers, the relevant cost remains the price of diesel actually purchased. In Romania, e-nergia reports another price hike of 9 bani/liter for gasoline and diesel at Petrom and OMV networks on September 11. At Petrom stations monitored by the publication in western Bucharest, standard gasoline is priced at 9.91 lei/liter , while standard diesel is at 10.37 lei/liter . These are local price examples. For a 50-liter fill-up, the 9-bani increase translates to an additional cost of 4.50 lei . E-nergia . Pump prices integrate refined product benchmarks, the USD/RON exchange rate, logistics costs, taxation, and commercial conditions. The diesel market was already tight prior to Thursday's military advance, meaning the local increase is part of a broader sequence of supply pressures. E-nergia, diesel…