Oil tops $107 as Saudi pipeline outage deepens Hormuz supply fears

Oil prices dropped on Wednesday after U.S. crude inventories unexpectedly increased, according to market sources citing American Petroleum Institute data. Brent crude futures fell by 93 cents, or 0.86 percent, to $107.82 a barrel, while U.S. West Texas Intermediate futures decreased by 97 cents, or 0.92 percent, at $104.86 a barrel.

Both benchmarks rose over $3 higher and reached their highest levels since May 19 due to supply concerns stemming from the suspension of oil loadings at Saudi Arabia's Yanbu port, a consequence of an attack on the East-West pipeline to the Red Sea by Yemen's Iran-aligned Houthis. The U.S. energy secretary stated that crude should resume flowing through Saudi Arabia's vital East-West pipeline within days; however, estimates of the pipeline's offline duration varied.

Libya's oil production remained relatively unaffected by the shutdowns, remaining at approximately 1.4 million barrels per day, according to the National Oil Corporation.