Daijiworld Media Network – New York
New York, Jul 23: Oil prices climbed more than 2% on Thursday, reaching their highest level in over six weeks, amid escalating tensions in the Middle East following fresh US military strikes on Iran and renewed attacks by Yemen's Houthi rebels on oil tankers in the Red Sea.
Brent crude futures rose $1.93, or 2%, to $96 a barrel by 0011 GMT, the highest level since June 8, after settling at $94.07 in the previous session. US West Texas Intermediate (WTI) crude gained $1.44, or 1.7%, to $88.27 a barrel, extending Wednesday's gains of nearly 3%.
The price rally came after the US military conducted a 12th consecutive night of strikes on Iran. The attacks followed US President Donald Trump's warning that the United States would target an Iranian bridge or power plant each time Iran attacks a ship in the Strait of Hormuz.
According to Iran's Revolutionary Guards, an oil tanker caught fire after an explosion while attempting to pass through what they described as a mined route south of the Strait of Hormuz. They said two other tankers turned back following the incident.
The Guards claimed the Strait of Hormuz was under Iranian control and "completely closed" while US military operations continued in the region, warning that no tanker would be allowed to enter or leave without coordination with Iran.
Meanwhile, the Iran-backed Houthis have expanded the conflict by threatening to target vessels transporting Saudi oil through the Bab el-Mandeb Strait and announcing what they described as a naval blockade of Saudi Arabia.
The group claimed responsibility for attacks on two Saudi oil tankers. Maritime security reports indicated that one of the vessels identified by the Houthis, the Saudi-flagged tanker Encelia, was struck in the Red Sea.
The Houthis also claimed they had forced around 10 ships to turn back after warning vessels against sailing to Saudi ports. Reuters said it could not independently verify the claim.
The escalating threats to both the Strait of Hormuz and the Bab el-Mandeb Strait have heightened concerns over potential disruptions to global energy supplies, contributing to the sharp rise in crude prices.
On the supply front, the US Energy Information Administration (EIA) reported that US crude inventories increased by 2 million barrels last week as refinery activity slowed, crude exports declined and imports rose. Analysts surveyed by Reuters had expected a drawdown of 1.1 million barrels.