Oil eases after Houthi attack drives crude above $106
Oil pulls back but stays elevated as markets weigh fresh Middle East risks
Oil prices retreated in Asian trading Friday after a Houthi missile attack on Saudi Arabia sent Brent above $106 a barrel overnight, reviving fears of disruptions to Middle East supplies.
Crude remained elevated as traders weighed fresh security risks against reports that Washington and Tehran are exploring a phased agreement to reopen the Strait of Hormuz.
At 1:18 pm Beijing time on Sept. 25, Brent crude was down 0.99% at $105.50 a barrel, after settling 3.4% higher at $106.60 on Thursday.
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US West Texas Intermediate crude fell 1.66% to $93.04 a barrel. Murban crude, the Abu Dhabi benchmark, was quoted at $117.60, up 4%.
Oil briefly eased as Iran and the United States reopened a diplomatic channel on the sidelines of the UN General Assembly.
Houthi strike revives supply fears
Oil jumped Thursday after Saudi Arabia said it intercepted six ballistic missiles fired by Yemen’s Iran-aligned Houthi movement toward the Taif and Yanbu areas.
Yanbu is a key Red Sea oil-export hub and the terminus of Saudi Arabia’s East-West pipeline, which allows the kingdom to export crude without relying on the Strait of Hormuz.reuters+1
The attack pushed both Brent and WTI as much as 5% higher during the session before prices retreated from their intraday peaks.
Brent recorded its highest settlement since Sept. 15, while WTI snapped a six-session losing streak in which it had fallen about 13%.
Talks offer a possible off-ramp
The market’s pullback reflects cautious optimism over indirect US-Iran diplomacy in New York.
Sources close to the talks said that negotiators are exploring a phased route out of the conflict. Under the reported framework, Iran would reopen the Strait of Hormuz while the United States would lift its economic and naval blockade on Iran.
No deal has been announced, and major disagreements remain.
Tehran wants relief from the blockade that has squeezed its economy, while Washington wants guaranteed freedom of commercial shipping through Hormuz, the maritime passage that carried roughly one-fifth of global oil supplies before the conflict began in late February.
