Crude Oil Prices Climb After Houthi Attacks and U.S. Diplomat Exit

Oil prices moved higher on Thursday after fresh attacks by the Houthis in Saudi Arabia led the United States to order some diplomats and family members to leave its missions in the Kingdom. Brent crude futures rose by $1.29, or 1.2 percent, to reach $110.11 a barrel at 00:34 GMT. U.S. West Texas Intermediate crude increased by 97 cents, or 1 percent, ending at $98.12. The U.S. State Department also plans to withdraw family members from several other regional missions.

Attacks and Regional Tensions

Yemen's Iran-aligned Houthis struck multiple targets on Wednesday. A civilian airport in Dammam suffered a strike that left at least one person dead and eight others wounded. A separate drone attack on a Saudi oil field killed two people. Meanwhile, explosions occurred in Sirik in southern Iran, though the origin remains unknown. Iranian Foreign Minister Abbas Araqchi stated that Iran is fully prepared to defend itself, and President Masoud Pezeshkian said the U.S. cannot expect dialogue while blockading and threatening Iran. Data from Kpler showed at least 18 attacks on shipping over the past two weeks. LSEG analysts warned that Iran is targeting tankers beyond the Strait of Hormuz into the Gulf of Oman.

Diplomatic Talks and Stockpiles

In separate diplomatic efforts, Russian President Vladimir Putin met with U.S. Special Envoy Steve Witkoff in St. Petersburg on Wednesday to discuss ending the war in Ukraine. The Kremlin announced that Mr. Putin agreed to resume U.S.-mediated peace talks with Ukraine next month, and Ukrainian President Volodymyr Zelenskiy expressed support for the talks. On the energy front, U.S. crude stocks fell by 3.06 million barrels to 412.5 million barrels last week, according to the U.S. Energy Information Administration. Distillate stockpiles rose by 1.68 million barrels to 104.3 million barrels. The U.S. Department of Energy announced it is offering to loan up to nearly a third of the 1-million-barrel U.S. emergency heating oil reserve to help contain prices.

Context

Escalating security threats in West Asia frequently disrupt global energy supply chains and shipping routes, directly impacting international crude prices. Ongoing conflicts in both West Asia and Europe continue to create severe pressure on global oil and diesel stockpiles.