Oil prices climbed about 3% on Thursday to a one-week high after a Houthi missile attack on Saudi Arabia revived supply-disruption fears. Trade stayed volatile, and both benchmarks pulled back from session highs after reports that the US and Iran discussed reopening the Strait of Hormuz.
Brent futures rose $3.52, or 3.4%, to settle at $106.60 a barrel, while US West Texas Intermediate crude rose $2.45, or 2.7%, to settle at $94.61. At their session highs, both contracts were up about 5%.
Brent notched its highest close since September 15. It marked the first rise in days for WTI, which had fallen 13% over the prior six sessions.
Saudi Arabia intercepts Houthi missiles
Saudi Arabia intercepted six ballistic missiles fired by Yemen's Iran-backed Houthis, thwarting attacks on the southern province of Taif and the Yanbu area on the Red Sea, the Saudi-led coalition in Yemen said. Separately, Saudi Arabia is building up crude pumping volumes through its East-West Pipeline that runs to its Red Sea export hub of Yanbu, though crude tanker loadings have yet to resume, according to industry sources, satellite imagery, and shipping data.
Sanctions and Hormuz talks cap gains
Iranian airlines were barred from neighboring countries including the UAE and Oman in response to new US sanctions targeting companies in third countries that do business with Iran. Iran threatened on Wednesday to retaliate against neighboring countries that comply with the flight ban.
Yet gains eased as US and Iranian negotiators in New York explore a phased path out of the nearly seven-month conflict, one that would involve Tehran reopening the Strait of Hormuz in exchange for Washington lifting its economic blockade of Iran. Neither side wants to surrender its leverage, according to Iranian sources, regional officials, and Western diplomats cited by Reuters.
Source: Investing.com
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