Daijiworld Media Network - New Delhi
New Delhi, Oct 28: Oil prices rose in early Asian trade on Wednesday amid renewed concerns over supply disruptions following reported Houthi attacks on Saudi Arabia and speculation about a possible fresh US military campaign against Iran after the November 3 midterm elections.
Brent crude futures rose 1.62% to $115.70 per barrel, while West Texas Intermediate (WTI) futures gained 1.34% to trade at $101.20 per barrel.
The gains followed a nearly $2 decline on Tuesday, driven by hopes that diplomatic discussions involving Saudi, Turkish, Pakistani and Iranian officials could help ease regional tensions.
Oil markets remained concerned over reports that Yemen's Houthi group had targeted Saudi Arabia's Ras Tanura complex. The group claimed on Tuesday that it had struck the refinery, which has a capacity of 550,000 barrels per day, with a ballistic missile. However, Saudi authorities had not confirmed a direct hit, and there was no independently verified evidence of extensive damage or a major disruption to operations.
Reports indicated that a fire near Saudi Aramco's facilities at Ras Tanura had been contained following an attack in the region early Tuesday. The extent of any damage remained unclear.
Saudi officials reported intercepting three ballistic missiles aimed at the kingdom's Eastern Province and four drones directed towards southern Saudi Arabia on Tuesday. Air defences also intercepted two missiles targeting Riyadh, where falling debris damaged a building, a construction site and a vehicle, according to Saudi Civil Defense statements reported by the Associated Press.
The Houthis separately claimed to have struck Saudi Arabia's Defence Ministry in Riyadh and targeted military aircraft. These claims had not been independently verified.
Ras Tanura is a key concern for oil markets because the complex combines substantial refining capacity with a major export terminal on the Persian Gulf.
Adding to market anxiety, a report by The Wall Street Journal said the United States had warned several Gulf Arab countries to prepare for the possibility of a short but intense military campaign against Iran after the November 3 midterm elections.
The latest attacks and reports of a possible renewed US-Israeli offensive against Iran have raised doubts over whether recent diplomatic efforts will lead to a de-escalation of tensions and the restoration of disrupted oil flows.
Meanwhile, US inventory data provided further support to crude prices. The American Petroleum Institute estimated that US crude oil inventories fell by approximately 2.03 million barrels in the week ended October 23. However, the impact was partly offset by increases in gasoline and distillate stocks.
Traders are now awaiting Wednesday's report from the US Energy Information Administration for further indications of inventory trends and their potential impact on oil prices.