Middle East Tensions Offset by Increased Oil Flows Despite US-Iran War
Oil prices declined on Friday but are still poised to rise by about a fifth for the month, despite rising tensions in the Middle East. Brent futures fell $1.03, or 1.2%, to $88 a barrel by 0215 GMT, while U.S. West Texas Intermediate (WTI) crude slipped $1.50, or 1.8%, to $82.09 a barrel.
The drop in prices is being offset by increased flows through the Strait of Hormuz, a key maritime chokepoint for global oil shipments. The strait has been largely blockaded since the February 28 launch of the U.S.-Israel war on Iran, but tanker traffic continues to flow through it and the Red Sea.
The Saudi defence ministry announced that 14 nations, including Djibouti, Egypt, Pakistan, Sudan, and Turkey, are in support of a multinational maritime defence coalition led by Saudi Arabia. However, Houthi militants in Yemen declared a naval blockade last week on Saudi Arabia, threatening the Red Sea route for its oil exports.