Oil Prices Rise After Houthi Saudi Hit
Global oil markets saw upward movement during Wednesday’s opening hours in Asia, as fresh Houthi strikes against Saudi Arabia reignited worries over supply stability. Benchmark Brent crude futures reached $115.70 per barrel, marking a 1.62% session gain, while West Texas Intermediate climbed 1.34% to trade at $101.20 per barrel. These gains followed a nearly $2 drop the previous day, fueled by optimism that diplomatic negotiations involving Saudi Arabia, Turkey, Pakistan, and Iran might yield progress.
That optimism faded after the Houthis announced they had launched a ballistic missile at the 550,000-barrel-per-day Ras Tanura refinery, raising fears of operational disruptions. The facility’s critical role in refining and exports makes it a key target in the escalating conflict.
Saudi Refinery Under Attack
Saudi officials have yet to confirm whether the refinery was directly struck, and no verified reports confirm significant damage or production halts. Initial accounts described a contained fire near Saudi Aramco’s Ras Tanura complex after Tuesday’s attack, though the full impact remains unassessed. While the Houthis’ claim about the refinery hit lacks official confirmation, Saudi authorities documented multiple missile and drone strikes across the kingdom.
Defense systems intercepted three ballistic missiles targeting the Eastern Province and four drones aimed at southern regions on Tuesday, according to Saudi statements. Separate reports indicated debris from intercepted projectiles caused damage in Riyadh, including harm to a building, construction site, and vehicle, per the Saudi Civil Defense.
Market Pressures Mount
The Ras Tanura facility remains a focal point due to its dual role as a major refining hub and a key export terminal in the Persian Gulf. Heightened tensions were further amplified by a Wall Street Journal report suggesting the U.S. has alerted Gulf allies to brace for a potential short, intense military campaign following the November 3 midterm elections. This warning adds to existing market anxieties.
Support for higher oil prices also came from U.S. inventory data, with the American Petroleum Institute reporting a 2.03 million-barrel decline in crude stocks for the week ending October 23. While gasoline and distillate inventories rose slightly, traders will scrutinize Wednesday’s EIA report for further confirmation of tightening supplies.
Uncertain Outlook
The latest wave of attacks and reports that the U.S. is preparing for a new military campaign against Iran after the midterm elections suggest Monday’s diplomatic efforts have resulted in little to no progress in bringing peace to the region and resuming oil flows. As a result, volatility is expected to persist in the near term, driven by ongoing supply concerns and geopolitical instability.
