Houthi Attacks Drive Oil Prices Higher

Oil prices climbed above $107 a barrel after attacks linked to Iran-backed Houthi forces disrupted Saudi Arabia’s East-West pipeline, which carries roughly 4% to 5% of global crude supplies and allows exports to bypass the Strait of Hormuz; repairs could take weeks. Saudi Arabia reported missile and drone attacks that wounded 13 people and damaged homes, while residents in six cities, including Yanbu, were temporarily told to shelter indoors; the Houthis said they targeted military facilities in retaliation for Saudi air raids in Yemen. A projectile reportedly struck a vessel transiting the Strait of Hormuz, while an Iranian commercial ship was reported hit near Iran, killing one person and injuring three; an Iranian Revolutionary Guard official warned U.S. warships against approaching the strait. The attacks have intensified concerns about prolonged energy and shipping disruptions, with record tanker rates, rising natural-gas and LNG prices, dwindling U.S. Strategic Petroleum Reserve releases and widening Brent spreads indicating tight physical markets; analysts said further attacks could push Brent above $120. Higher fuel costs are contributing to a weaker Indian rupee, rising gasoline and diesel prices and broader inflation, while Human Rights Watch warned that recent Houthi attacks on commercial vessels may constitute war crimes and fighting along Yemen’s western coast has displaced nearly 94,000 people.