Oil Prices Soar to Two-Month High After Red Sea Attacks
The price of oil surged to $100 per barrel on Thursday for the first time in two months, following fresh attacks in the Red Sea that escalated tensions in the Middle East.
The benchmark oil price has been steadily rising since the US-Iran ceasefire deal broke down. On Thursday, it jumped 6.9% to $100.6 per barrel after US President Donald Trump warned of a 'major military punishment' on Iran and its allies if attacks continue.
The Houthi rebels had threatened to blockade key oil export routes in the Red Sea, which would disrupt global supplies. Economists at Oxford Economics predict that shipping disruption is now 'increasingly likely' and forecast oil prices will remain above $85 per barrel through the rest of the year.
Lucy Smith, senior investment manager at Killik & Co, noted that geopolitical tensions can quickly affect energy markets. She warned that an escalation in attacks on critical shipping routes or energy infrastructure would increase concerns about global flows and keep prices elevated.