Oil prices rise after military raidscarried out USA with allies against targets in Houthi-controlled areas of Yemen amid escalating tensions in the Red Sea.
Global benchmark Brent was trading about 4% higher at $80.55 a barrel, while the US West Texas Intermediate contract rose 4.22% to $75.07 a barrel.
“These targeted strikes send a clear signal that the United States and our partners will not tolerate attacks on our personnel or allow hostile actors to compromise freedom of navigation along one of the world’s most important trade routes.” – US President Joe Biden said in a statement released on Thursday evening.
While the US has been targeting Iranian proxies in Syria and Iraq since the start of the Gaza war, this first known strike on the Iran-backed Houthis in Yemen.
Western governments are negotiating how to respond to Houthi attacks in the region through which nearly 15% of global maritime trade passes. In this context, the voices of those who are concerned about the risk of escalation of the conflict in the Middle East are also heard. Bjarne Schildrop, a commodities analyst at SEB, warned that the airstrikes could provoke retaliation from Iran and its allies. “The fear in the oil market is that the region is on an unpredictable path of escalation, and at some point oil supplies will actually end up being lost,” he said.
Iran backing the Houthis on Thursday hijacked an oil tanker off the coast of Oman, south of the Strait of Hormuz on the other side of the Arabian Peninsula, the world’s most important oil transportation route. We’re talking about a tanker.”St. Nikolas” under the flag of the Marshall Islands (formerly Suez Rajan), which is associated with the Greek shipping company Empire Navigation.
On Thursday morning, armed men who Tehran said belonged to the country’s navy boarded the tanker. Maritime security company Ambrey said “six armed men dressed in black” boarded the vessel. During the invasion they covered the surveillance cameras.
The incident began in the early morning of January 11 in the waters between Oman and Iran, near the Omani city of Sohar, through which ships pass in and out of the Strait of Hormuz.
Traders and analysts are wary of making aggressive forecasts for oil this year as worries about instability in the Middle East outweigh worries about global demand and an uncertain economic outlook.
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