Oil prices rose nearly 3% during Monday's Asian deals 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.
By 2:35 pm AEST (4:35 am GMT), Brent crude futures had risen $2.99, or 2.9%, to $107.60 per barrel, while United States West Texas Intermediate (WTI) futures gained $2.86, or 2.9%, to $102.91 per barrel.
ING commodities strategists commented in 'The Commodities Feed':
"This follows a step-up in attacks on Saudi Arabian energy infrastructure, including targeting the crucial East-West pipeline, a vital bypass route for Saudi oil exports during disruptions through the Strait of Hormuz.
"The Saudis have shut down the 7m b/d pipeline. It’s unclear how severe any potential damage is, or how long it will be out of action. Clearly, the recent escalation poses risks to our forecast, pushing us closer to our more pessimistic scenario.
"For now, we’re sticking with our base case of Brent averaging $80/bbl in 4Q26. The situation is fluid as we continue to see sizeable volumes of oil still moving through the Strait of Hormuz."
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 bypass the Strait of Hormuz and reroute its exports, threatens up to 4% of global oil supply.
Meanwhile, a vessel in the Strait of Hormuz was struck by a projectile, causing a fire and forcing the crew to be evacuated, the United Kingdom Maritime Trade Operations (UKMTO) said on Sunday.
