Crude Prices 3% Higher as Oil Tankers Avoid Red Sea After Strikes
On Friday crude prices rose around 3%, as some oil tankers avoided the Red Sea after overnight sea and air strikes on Houthi targets in Yemen by Britain and the United States after the Iran-backed group attacked shipping.
U.S. West Texas Intermediate crude futures climbed $2.13, or 3%, to $74.15 per barrel, while Brent crude futures were up $2.21, or 2.9%, at $79.62 per barrel.
Both benchmarks were on track for the second consecutive weekly gain.
The UK and U.S. strikes were made in retaliation for Houthi attacks on commercial ships in the Red Sea since October in a show of support for Hamas, the Palestinian militant group, in its war against Israel.
The escalation has increased market fears about the Hamas-Israel war escalating into a wider conflict in the Middle East that will affect oil supplies from the area.
That includes the Strait of Hormuz between Iran and Oman. On Thursday Iran seized a tanker carrying crude from Iraq on its way to Turkey.
ING analysts in a note said over 20M barrels per day of oil are shipped via the Strait of Hormuz, equivalent to about a fifth of global consumption.