Middle East Tensions Send Oil Prices Soaring Over $107 per Barrel
Global oil prices surged over 2% on Monday as tensions in the Middle East intensified concerns about supply disruptions. The Brent crude futures contract rose to $107.51 per barrel, while West Texas Intermediate strengthened to $102.32 per barrel.
The price increase comes after a series of incidents, including Houthi attacks on Saudi Arabia, ships in the Gulf region being hit by projectiles, and the closure of Saudi Arabia's East-West pipeline due to a drone attack from Iraq.
The pipeline's shutdown threatens up to 4% of the world's oil supply, while the disruption of the Bab Al-Mandab Strait could impact around 4-5% of global oil supplies. IG market analyst Tony Sycamore warned that unless talks in Oman produce a breakthrough or the East-West pipeline is restored, crude oil prices may continue to rise towards $119.48 per barrel.
Saudi Arabian state media released footage showing damage caused by Houthi attacks on houses and a mosque in Jazan Province. The Houthi group also claimed to have attacked a Saudi military base in a neighboring province.