Houthi Attacks Spark Oil Price Surge Amid 'Economic Warfare' Threat

Oil prices reached multi-week highs on Tuesday after attacks by Yemen's Iran-aligned Houthis on Saudi energy facilities and a threat of 'economic warfare' from Tehran. The Brent crude futures price rose to $99.00 per barrel, its highest since July 24, while U.S. West Texas Intermediate crude hit $94.41 per barrel.

Tim Waterer, chief market analyst at KCM Trade, attributed the price surge to both genuine physical tightness and a geopolitical risk premium. He noted that tanker flows through the Strait of Hormuz remain well below normal and that the risk premium is doing 'a lot of the heavy lifting'.

The operations of some energy facilities in Saudi Arabia were halted following the attacks, which wounded 73 people according to Saudi authorities. Iran also threatened the United States with 'economic warfare' after firing an advanced missile at U.S. warships, underscoring the risks of further escalation in the war.

Goldman Sachs raised its Brent and WTI price forecasts by $5 to $85 and $80, respectively, for December 2026 and to $80 and $75, respectively, for 2027, reflecting its assumption that Middle East shipping disruptions will continue into 2027.