Oil prices rose sharply on Tuesday as renewed Houthi attacks on Saudi Arabia increased concerns over potential supply disruptions across the Middle East.
Crude markets were also supported by delays in talks aimed at reopening the Strait of Hormuz. The uncertainty kept a significant geopolitical risk premium priced into oil.
Brent crude futures climbed 1.6% to $107.39 a barrel by 22:45 ET, while West Texas Intermediate crude futures rose 1.7% to $103.09 a barrel.
Houthi Attacks Increase Oil Supply Risks
Yemen’s Iran-aligned Houthi movement launched additional attacks against Saudi Arabia on Monday.
The group has strengthened its presence around key areas near the Red Sea, allowing it to increase pressure on regional shipping routes.
The Bab al-Mandab strait has become a major concern because it serves as an important route for global energy shipments.
Further attacks on shipping in the region could disrupt oil flows and increase transportation risks for energy companies.
Saudi Oil Infrastructure Faces Renewed Pressure
The Houthis reportedly targeted several locations in Saudi Arabia on Monday.
The attacks added to existing concerns over Saudi oil exports after strikes during the previous week forced the kingdom’s East-West pipeline offline.
The expanding Houthi offensive has effectively opened another front in the wider Middle East conflict.
Analysts estimate that the latest developments could potentially threaten an additional 4% to 5% of global oil supplies.
That possibility has helped push crude prices higher as traders assess the risk of further disruptions.
Strait of Hormuz Talks Delayed
Diplomatic efforts to restore normal shipping through the Strait of Hormuz also faced another setback.
Oman postponed a planned meeting between Iran and Gulf states that had been expected to focus on reopening the strategic waterway.
Muscat did not provide a new date for the talks.
The delay has increased uncertainty over when oil flows through Hormuz could return to more normal levels.
Hormuz Oil Flows Remain Severely Restricted
Shipping through the Strait of Hormuz remains far below levels seen before the conflict.
This has limited any meaningful improvement in global crude supply conditions.
Iran said a Panamanian-flagged oil tanker was struck by sea mines while traveling through the strait.
However, U.S. Central Command disputed the claim and said the report was false.
The conflicting statements have added to uncertainty surrounding security conditions in the region.
U.S.-Iran Tensions Remain High
U.S. President Donald Trump again said on Monday that Iran was seeking a peace agreement.
Tehran rejected that claim and said negotiations would not take place until its conditions were met.
Iran has insisted that the United States must adhere to the terms of a June ceasefire agreement that has since expired.
The continued disagreement has reduced expectations for a quick diplomatic breakthrough.
Strait of Hormuz Remains Crucial for Global Oil Markets
The Strait of Hormuz remains one of the most important areas to watch in the ongoing conflict.
Before the U.S.-Iran war, roughly one-fifth of the world’s oil supply passed through the waterway.
Any prolonged disruption therefore has the potential to significantly affect global energy markets.
For now, rising geopolitical tensions, disrupted Saudi infrastructure, and uncertainty surrounding Hormuz are keeping oil prices elevated and supply risks firmly in focus.
