London — Oil prices advanced sharply on Monday as renewed attacks targeting Saudi Arabia and commercial shipping in the Gulf intensified concerns about potential disruptions to crude supplies.
Brent crude futures rose $2.93, or 2.8%, to $107.54 a barrel at 0700 GMT. U.S. West Texas Intermediate futures gained $2.88, or 2.9%, reaching $102.93 a barrel.
The latest increase came after attacks struck Saudi energy and civilian infrastructure, including an assault that temporarily forced the closure of the country’s East-West oil pipeline. The route is strategically important because it enables Saudi Arabia to move exports toward the Red Sea instead of relying on shipments through the Strait of Hormuz.
The pipeline disruption could threaten as much as 4% of global oil supplies. Industry sources said stocks at Yanbu, the Red Sea export port, were sufficient for only five to seven days of exports.
Risks to maritime traffic are also mounting. A vessel traveling through the Strait of Hormuz was hit by a projectile, prompting its crew to evacuate, while Iran reported casualties aboard a commercial ship.
At the same time, Yemen’s Iran-aligned Houthis have reached Perim Island, a strategically located area near the Bab el-Mandeb Strait. The waterway has accounted for an estimated 4% to 5% of global oil flows in recent months.
The developments follow an 8% jump in oil prices last week, when crude also moved above $100 a barrel for the first time since July. The latest moves highlight increasing strain on global energy markets.
Original article
Comments