Brent Hits $111.44 as Oil Nears Iran-War High Ahead of Midterms

Brent crude jumped 3.4% to $111.44 a barrel on Friday, closing in on its wartime settlement high of $118.35 as traders priced in possible fresh U.S. and Israeli strikes on Iran after elections in both countries. West Texas Intermediate for December delivery climbed 3.5% to $103.09 a barrel, FactSet data shows.

Eight months into the Iran war, the global energy crisis shows no sign of easing. Prices are hurtling toward their highest levels since the conflict began in February, stoking fears of an even harsher energy crunch.

"Worries about oil back over $100 a barrel and the Iran conflict flaring up again are top of mind heading into the weekend," said Ryan Detrick, chief market strategist at Carson Group.

Why are prices surging now?

The Iran-backed Houthis conducted further drone strikes Wednesday on Saudi airports and the Shaybah oil field operated by Saudi Aramco. Those attacks led the U.S. to order embassy staff in Riyadh to leave the country earlier this week. Trump has warned that the U.S. could attack Iran anew after the Nov. 3 midterm elections, and both the U.S. and Israel have prepared strike options for after voters go to the polls. Israel holds its elections Tuesday.

Iran raised the stakes further. According to Wall Street Journal reporting, Tehran said that if U.S. and Israeli bombings resume, it will respond with strikes on pipelines and airports in oil-rich Persian Gulf countries.

"Iran is agitating to keep oil prices high and push down American popular support for the Trump administration and the war," said Matt Gertken, chief geopolitical and U.S. political strategist at BCA Research. "But after the election President Trump will intensify strikes to try to coerce Iran's leaders into a ceasefire."

What has Trump said?

Trump hinted at fresh action during a speech Thursday in Sioux City, Iowa. "We're going to have Iran finished very soon," he said. "One way or the other, it's going to be done very soon, and your gasoline prices and your oil is going to come tumbling down."

White House spokeswoman Anna Kelly said in an emailed response Friday that the U.S. will not attack Iran "at any time" before the midterms. "As President Trump stated, Iran is in very bad condition, both economically and militarily, and the blockade will remain in full force and effect, with oil flowing in record numbers of barrels through the Hormuz Strait," she said.

How exposed are Trump and the Republicans?

The pump price is the one issue the party can't spin. The national average for a gallon of regular gasoline stands at $4.29, according to AAA, up from less than $3 before the war. Markets are already juggling earnings, an upcoming Federal Reserve rate decision and mounting worries over AI build-out debt.

The post-midterm outlook is cloudy. Democrats appear poised to take at least one chamber of Congress and have pledged to wind down the war. But they're unlikely to win enough seats to override a Trump veto of a bill restricting military operations, as a national security expert wrote in a CNN analysis.

Trump has tried to ease the pressure. He temporarily allowed Russia to supply diesel to U.S. and other markets and announced plans to use Defense Production Act funding to expand oil production and refining.

"This is a policy for the 2030 diesel market," Giacomo Prandelli, a commodity analyst and author of the Merchant's News newsletter, said on X. It takes years to build a refinery, and voters "pay today's prices."

Where does oil go from here?

"The oil market isn't pricing availability alone. It's pricing reliability," said Angie Gildea, global head of oil and gas at KPMG. "Even when barrels are flowing, concerns about energy infrastructure and shipping routes can keep a risk premium in prices."

Fawad Razaqzada, global macroeconomic market analyst at StoneX Trading and Forex.com, sees Brent holding between $110 and $120 a barrel, raising inflation risks. "That in turn could be bad news for all sorts of risk assets," he said Friday.

Gertken said consumers can handle oil averaging $105 a barrel, but not $160. If oil reached that level, the Trump administration might try "toppling the Iranian regime" — so, he argued, Iran will probably not push prices that high. He expects U.S. strikes to intensify in the coming months, followed by negotiations, as both sides lack the "economic and political capabilities to support a longer war."

Both benchmarks have risen for three consecutive weeks and were on pace Friday for their biggest three-week advance since early September, according to FactSet. With no end to the conflict in sight, analysts expect prices to stay elevated even after the midterms.