WTI consolidates near $72.90 after Houthi’s attack on USS Laboon in the Red Sea
WTI price gains ground for the third session on fear of conflict escalation in the Red Sea. Iran-led Houthis launched a cruise missile at the US Navy vessel in the Red Sea. Protesters threatened to close down two additional oil and gas facilities in Libya.West Texas Intermediate (WTI) price attempts to move on an upward trajectory, trading near $72.90 per barrel during the Asian session on Monday. Crude oil prices could potentially experience further gains due to concerns over the escalation of the Israel-Gaza conflict. This speculation has heightened, particularly after Iran-led Houthis fired an anti-ship cruise missile at the USS Laboon in the Red Sea on Monday. The missile was intercepted by a US fighter jet, resulting in no harm to the navy vessel or the aircraft.
The current situation follows the military attacks on Iran-led Houthi targets carried out by the United States (US) and the United Kingdom (UK) on Friday. In response to the strikes, several tanker owners chose to avoid the Red Sea, and multiple tankers altered their course on Friday. While traders remained vigilant for potential impacts on shipments in the Strait of Hormuz, they were also closely monitoring Iran's response. On Sunday, the Houthi militia group issued a threat of a "strong and effective response" after the United States conducted another strike overnight, escalating tensions.
US President Joe Biden expressed concern about the potential impact of the war in the Middle East on oil prices. This concern comes in the wake of increased tensions in the region after the United States and Britain launched numerous air strikes across Yemen on Houthi targets. The military actions have contributed to a rise in oil prices, prompting President Biden to acknowledge the potential economic repercussions of the conflict on global oil markets.
Protesters threatened to close down two additional oil and gas facilities in Libya. This comes after the shutdown of the Sharara field on January 7. The protests are driven by concerns about corruption, and the threat to shut down more facilities indicates ongoing tensions and challenges within the country's energy sector.