Crude oil prices edged upwards once again on Wednesday after retreating briefly the previous day, with global benchmark brent crude trading 1.25% higher at $107 per barrel and West Texas Intermediate (WTI) trading at $95.34/barrel, up over 1%.
Iranian attacks on vessels and tankers in the Strait of Hormuz intensified late on Tuesday night, threatening the resumption of oil supply from Gulf through the key maritime strait and safe passage of ships.
Additionally, Saudi Arabia's headquarters complex in Dhahran was struck by a ballistic missile on Tuesday, causing a small fire and no injuries, and exposing the vulnerability of crucial energy infrastructure. Saudi said it had intercepted more missiles launched by Iranian-backed Houthis.
Saudi Aramco (officially the Saudi Arabian Oil Company) is the state-owned national oil and natural gas company of Saudi Arabia and one of the world's largest integrated energy and chemicals producers.
Traders are critically assessing the prospect of diesel relief from Russia. US President Donald Trump's deal with Russia to supply 4.8 million metric tons, or nearly 36 million barrels total of diesel globally would suffice only a single-day of the cumulative demand, equivalent to 10 days of domestic American demand.
Brent rates have rallied over 70% this year as the US-Iran war triggered a massive energy supply globally. Houthis' attack on Riyadh's main airport last week magnified the threat. Following the strike, Saudi-backed forces launched a campaign to reclaim rebel-held territory in Yemen. Ship strikes in Hormuz have also compelled more supertankers to turn away from the Persian Gulf.
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Iran-backed Houthi militants in Yemen claimed responsibility for a missile strike on King Khalid International Airport in Riyadh over the weekend. The attack killed at least a dozen people and injured more than 300, according to reports.
Subsequent missile and drone attacks have added to concerns about a broader escalation and the potential impact on regional energy supplies.
The developments have increased pressure on the Trump administration to consider greater assistance to Saudi Arabia as the conflict involving the Houthis intensifies.
The ongoing Russia-Ukraine conflict is another factor influencing crude oil prices. Ukrainian President Volodymyr Zelenskyy said Russia continued to target Ukraine's energy infrastructure despite US President Donald Trump's announcement of an energy ceasefire.
The continued strikes have raised doubts about whether the proposed truce will prevent further disruptions to energy facilities. Ukraine has also vowed to continue its attacks against Russia.
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