Oil prices up over 3% following new strikes on Saudi and Strait of Hormuz

Oil prices rose more than 3% on Monday, after new Houthi strikes on Saudi Arabia and Iranian attacks on ships in the Gulf compounded supply concerns following the closure of a key Saudi oil pipeline, Reuters reports.

Brent crude futures rose $3.21, or 3.1%, to $107.82 per barrel. WTI futures gained $3.17, or 3.2%, to $103.22 per barrel. “This follows a step-up in attacks on Saudi Arabian energy infrastructure, including targeting the crucial east-west pipeline,” said ING commodity ⁠strategists, although noting that it was unclear how severe any potential damage was or how long the pipeline would be out of action. Saudi Arabia’s East-West oil pipeline was temporarily shut following a drone attack, according to Saudi officials. The shutdown of the pipeline, which helps Saudi Arabia avoid the Strait of Hormuz and re-route its exports, threatens up to 4% of global oil supply.

With the pipeline out of service, Yanbu has enough inventory to cover just five to seven days of exports, according to three industry sources familiar with Saudi Arabia’s exports.