Oil prices reached their highest level in five months on Thursday. This price increase is due to recent attacks in Saudi Arabia and incidents involving tankers in the Strait of Hormuz, which have posed threats to global oil supply.
Increase in Oil Prices
Brent crude oil, which is recognized as the international benchmark for oil prices, rose by 3% to $112 per barrel, marking an unprecedented level since May 18. This price increase followed attacks by Houthi rebels from Yemen, who are allied with Iran, on several targets in Saudi Arabia. In these attacks, two people were killed at a civilian airport in Dammam, and eight others were injured.
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Attacks and Reactions
The Islamic Revolutionary Guard Corps (IRGC) of Iran announced that they targeted and set fire to four ships that were illegally transporting oil in the Persian Gulf. Additionally, three other ships near the Strait of Hormuz encountered mines, and this body warned the United States that continued provocations could lead to broader reactions against its regional bases.
In response to these developments, the United States evacuated several diplomats and their family members from their missions in Saudi Arabia and is planning to withdraw family members of diplomats from other missions in the Middle East as well. Furthermore, Saudi Aramco has instructed its employees to evacuate from their headquarters in Dhahran and work remotely.
Concerns about escalating conflicts in the region have increased as it has been eight months since Tehran effectively blocked the Strait of Hormuz, which many believe could lead to the largest disruption in energy supply in market history. Oil prices reached $100 per barrel earlier this week and are expected to rise to $150 as tensions continue.
However, data indicates that oil exports from the Persian Gulf have now surpassed pre-war levels. This increase is attributed to oil being transported through pipelines to the Red Sea and the Gulf of Oman.
On Thursday, global markets were affected by expectations of rising inflation costs and borrowing. The Stoxx Europe 600 index fell by 1%, and the UK's FTSE 100 also dropped by 0.7%.
In Asia, Japan's Nikkei 225 index fell by 2.7%, while South Korea's KOSPI dropped by 3.5%, and the Hong Kong index experienced a 3% decline.
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