Global oil prices rose more than 3 per cent on Monday following fresh Houthi attacks on Saudi Arabia and a reported strike on a vessel in the Strait of Hormuz, deepening concerns over disruptions to global crude supplies.
Brent crude futures climbed $3.21, or 3.1 per cent, to $107.82 a barrel by 0340 GMT, while US West Texas Intermediate crude gained $3.17, or 3.2 per cent, to $103.22.
The latest gains followed the temporary shutdown of Saudi Arabia’s East-West oil pipeline after a drone attack, according to Saudi officials.
The pipeline is strategically important because it allows Saudi Arabia to transport crude to the Red Sea port of Yanbu and bypass the Strait of Hormuz, a vital global oil shipping route.
Analysts at ING said the latest price increase followed an escalation in attacks on Saudi energy infrastructure, including the East-West pipeline.
“It remains unclear how severe any potential damage is or how long the pipeline will be out of action,” the analysts said.
The disruption could affect as much as four per cent of global oil supply, while three industry sources told Reuters that Yanbu had sufficient inventories to maintain exports for only about five to seven days.
Saudi state media on Sunday released footage showing damage to homes and a mosque in the southern Jazan province, which authorities attributed to a Houthi attack.
The Houthis also claimed to have targeted a Saudi military base in a neighbouring province.
Meanwhile, the United Kingdom Maritime Trade Operations agency said a vessel in the Strait of Hormuz was struck by a projectile, triggering a fire and forcing its crew to evacuate.
Iranian authorities said one person was killed and four crew members were injured after an Iranian commercial vessel was struck off the country’s coast.
The latest incidents have added to concerns over the security of two critical oil shipping routes — the Strait of Hormuz and the Bab el-Mandeb Strait.
Yemen’s Iran-aligned Houthis reached the strategic island of Perim on Friday, strengthening their position near the Bab el-Mandeb, another major maritime chokepoint.
The waterway has carried about four to five per cent of global oil supplies in recent months.
Oil prices surged about eight per cent last week amid mounting supply disruptions, pushing crude above $100 a barrel for the first time since July.
The escalation has also complicated diplomatic efforts to address the conflict.
Omani Foreign Minister Badr Albusaidi said on Sunday that a meeting scheduled for Monday between Gulf countries and Iran to discuss the Strait of Hormuz had been postponed.
No formal peace talks have been held over the war, which began six months ago with US and Israeli strikes, since an interim agreement reached in June subsequently collapsed.
