Escalating Middle East Attacks Deepen Oil Supply Fears, Raising Risk of Further Price Gains
Summary
- Intensifying attacks in the Middle East are heightening fears of global crude supply disruptions.
- Attacks by Yemen's Houthi rebels are threatening Saudi oil infrastructure and crude exports through the Red Sea.
- The risk of further gains in global oil prices could persist as crude supply disruptions and high diesel prices continue.
Forecast Trend Report by Period
Attacks across the Middle East are intensifying, adding to concerns over disruptions to global crude supply.
Walter Bloomberg, an overseas economic news feed, reported on October 12 that mounting missile and drone attacks by Yemen's Houthi rebels on Saudi Arabia are threatening key oil infrastructure and crude exports through the Red Sea.
Energy markets view Saudi Arabia's Yanbu and Jizan regions as particularly vulnerable. If facilities there are hit, Saudi Arabia may need to ship more crude through the Strait of Hormuz, where transport risks are also rising.
The stabilizing effect of Russian diesel supplies on prices may also be limited. The outlet said diesel trade with Russia promoted by President Donald Trump would cover only about 10% of the global supply shortfall, limiting its ability to reduce high fuel prices.
Uncertainty also continues over a proposed ceasefire on energy facilities between Russia and Ukraine. Ukraine said Russia had launched a new attack, while Russia has not officially confirmed any related agreement.
As a result, the risk of further gains in global oil prices could persist as crude supply disruptions drag on and diesel prices remain high.
Minseung Kang
minriver@bloomingbit.ioBlockchain journalist | Writer of Trade Now & Altcoin Now, must-read content for investors.