Oil Prices Rise Above $110 as Houthi Attacks on Saudi Arabia Fuel Supply Fears

Oil prices rose by more than $1 a barrel on Thursday as renewed Houthi attacks in Saudi Arabia heightened concerns about a wider regional conflict and further disruptions to Middle Eastern energy supplies.

Brent crude futures climbed $1.93, or 1.77 per cent, to $110.75 a barrel at 7:42 a.m. Saudi time. US West Texas Intermediate crude gained $1.43, or 1.47 per cent, to $98.58 a barrel. Brent had closed largely unchanged on Wednesday, while WTI fell 67 cents.

“Oil prices remain well bid, with ICE Brent back above $110 per barrel this morning following additional deadly attacks on Saudi Arabia,” ING analysts said in a note on Thursday.

Yemen’s Iran-aligned Houthis attacked several targets in Saudi Arabia on Wednesday. At least one person was killed and eight others wounded in an attack on a civilian airport in Dammam, while two people died in a drone strike on a Saudi oil field.

The escalation has raised concerns about the security of regional infrastructure and the potential impact on global oil supplies. US officials told Reuters that the State Department was preparing to withdraw family members from several additional US diplomatic missions in the region.

Meanwhile, Iranian media reported explosions in Sirik in southern Iran on Wednesday, although the nature and origin of the blasts remained unknown.

Iran’s Islamic Revolutionary Guard Corps Navy said on Thursday that four vessels involved in what it described as illegal oil transfers in the northern Persian Gulf had been struck simultaneously and caught fire after being tracked by its forces a day earlier.

The IRGC also said three other vessels had collided with mines west of the Strait of Hormuz. It warned the US military that continued provocations could trigger a broader response against American bases in the region.

Market concerns were reinforced by changes in US crude inventories. The US Energy Information Administration reported that crude stocks fell by 3.06 million barrels to 412.5 million barrels last week. Analysts surveyed by Reuters had expected a decline of 820,000 barrels.

Distillate inventories, which include diesel and heating oil, moved in the opposite direction, rising by 1.68 million barrels to 104.3 million barrels. Analysts had forecast a decrease of 1.16 million barrels.

The US Department of Energy said the Trump administration was offering loans of up to nearly one-third of the country’s one-million-barrel emergency heating oil reserve in an effort to contain prices that have risen amid diesel shortages linked to the wars in Iran and Ukraine.

Diplomatic efforts to end the conflict in Ukraine also remained in focus. Russian President Vladimir Putin met US Special Envoy Steve Witkoff in St Petersburg on Wednesday to discuss ending the war.

The Kremlin said Putin had agreed to resume US-mediated peace talks with Ukraine as soon as next month. Ukrainian President Volodymyr Zelenskiy welcomed the prospect of negotiations and said he hoped they would begin as soon as possible.

Traders will continue monitoring developments across the Middle East, particularly attacks on energy infrastructure and shipping routes, for indications of how regional tensions could affect oil production and exports.