Brent crude closes at $116.72, a six-month high
Oil has risen three weeks in a row on fears of more attacks in the Middle East, and Mexico's export blend is near $107.
Brent crude, the global oil benchmark, ended Friday at $116.72 a barrel. It was the highest level in six months and the third straight weekly gain.
West Texas Intermediate, the U.S. benchmark, finished just above $103. Mexico's export blend, the basket of crudes that state oil company Pemex sells abroad, reached $107 in Pemex's daily estimate.
Traders are pricing in a wider fight in the Middle East. Attacks near the Red Sea have raised fears of further supply restrictions, and the Strait of Hormuz remains at the center of the conflict with Iran.
| Benchmark | Thursday, Oct. 22 | Friday, Oct. 23 |
|---|---|---|
| Brent | 113.17 | 116.72 |
| WTI | 99.47 | Above 103 |
| Mexican blend | 104.06 | 107 |
On Thursday, Brent had already risen 4.0% and the Mexican blend 4.5%. The Nasdaq fell 2.60% that day.
In the United States, a gallon of gasoline cost $4.29 on Friday, about $1.22 more than a year ago, and diesel was near $6.31. Tom Kloza, chief energy adviser at Gulf Oil, expects "a lot of $5 gas prices" in Michigan, Ohio, Minnesota, Illinois and Indiana.
For ING's Warren Patterson, the rally reflects fear of running short of crude more than the current balance of supply and demand. A pricier blend also means more revenue for Pemex on every barrel it exports.
BlackRock warned that costlier energy could make core inflation, which strips out the most volatile prices, stickier and keep monetary policy tight for longer.
