Oil Prices Plunge Amid Ongoing Middle East Tensions

Oil prices continued to decline on July 31, with Brent crude trading at $88 per barrel and US West Texas Intermediate dipping over 2% to $81.70 per barrel.

The decline comes as investors assess Saudi Arabia's proposal to lead a multinational maritime defense coalition aimed at bolstering security along key Red Sea shipping routes.

Saudi Arabia has secured backing from 14 countries, including Turkey and Egypt, for the proposed alliance to enhance defense cooperation in the Bab El-Mandeb Strait, the Red Sea, and the Gulf of Aden.

Goldman Sachs warns that Brent could climb to $120 a barrel if shipping disruptions through the Strait of Hormuz continue, while JPMorgan estimates that every additional month of supply disruption could add around $7 to $8 per barrel to Brent prices.