Oil Prices Surge Above $107 Amid Middle East Supply Risks

Oil prices surged above $107 per barrel on Monday as Middle East supply risks deepened. The rise in Brent crude was driven by fresh attacks from Yemen's Iran-aligned Houthis and Iran on shipping, compounding concerns over global supplies after a key Saudi oil pipeline was shut.

The shutdown of the Saudi East-West pipeline threatens up to 4% of global oil supply, adding to the risks surrounding the Strait of Hormuz. The Houthi rebels also reached the strategic island of Perim on Friday, tightening their position near another key oil transit route, the Bab el-Mandeb Strait.

According to IG market analyst Tony Sycamore, unless this week's talks in Oman produce something operational, or the East-West pipeline is brought back online quickly, crude oil could continue to extend its gains toward $119.48 per barrel, the high of early March.