By Adedapo Adesanya
The crude oil market rose by 1 per cent on Friday as an increasing number of oil tankers diverted course from the Red Sea following overnight air and sea strikes by the US and Britain on Houthi targets in Yemen after attacks on shipping by the Iran-backed group.
The price of Brent crude futures increased by 88 cents or 1.1 per cent to $78.29 a barrel and that of the US West Texas Intermediate crude futures climbed by 66 cents or 0.9 per cent to $72.68 per barrel.
The US on Friday said that 28 locations had been hit in the initial strikes, using more than 150 munitions, while Britain’s Royal Air Force bombed two, a sweeping bombing campaign intended to halt a spate of Houthi attacks on shipping in the southern Red Sea that has disrupted world trade and threatened to push up inflation.
The Combined Maritime Forces (CMF), a multinational maritime partnership led by the US from Bahrain, warned all ships to avoid the Bab al-Mandab Strait at the south end of the Red Sea for several days.
The Houthis have been targeting commercial vessels since late last year in attacks the groups says aim to support the Palestinians against Israel’s devastating offensive in the Hamas-ruled Gaza Strip.
The diversions were expected to push up the cost and time it take to transport oil, supplies have not yet been impacted.
According to analysts and industry experts, this is the main reason prices have not jumped really high.
Iran has on Thursday seized a tanker with Iraqi crude destined for Turkey. That incident took place closer to the Strait of Hormuz, between Oman and Iran, another important shipping corridor.
Houthi militants also mistakenly targeted a tanker carrying Russian oil in a missile attack on Friday off Yemen.
Analysts expect Houthis to attempt some sort of retaliation after the US and Britain struck just under 30 different locations in Yemen.
Meanwhile, Saudi Arabia called for restraint and associated avoiding escalation and said it was monitoring the situation with great concern.
Also supporting oil prices, China bought record levels of crude oil in 2023 as demand recovered form a pandemic-induced slump despite economic headwinds in the world’s biggest oil importer.
In Libya, protesters who have threatened to shut down two oil and gas facilities in Tripoli said they have decided to extend deadline for closing the facilities following negotiations.
Modupe Gbadeyanka