Oil Prices Rise on Saudi-Houthi Conflict, Brent Tops $106

Global crude prices have risen again on supply worries as fighting between Saudi Arabia and Yemen's Houthi rebels intensifies. Analysts say the prospect of higher diesel exports from Russia is holding back any sharp jump for now. The trend was visible in Asian trading on Wednesday, October 14.

At 12:30 a.m. GMT, Brent crude futures, the international benchmark, gained 89 cents, or 0.8 percent, to $106.58 a barrel. At the same time, US West Texas Intermediate (WTI) rose 80 cents, or 0.9 percent, to $94.94. Several media outlets reported the figures citing Reuters.

On Tuesday, Brent had settled 0.9 percent lower at $105.69 a barrel, while WTI rose 0.4 percent to close at $94.14. Wednesday's gain therefore looks largely like a rebound after the previous day's dip.

Traders see Houthi attacks on Saudi energy infrastructure as the main driver. On Tuesday night, an administrative building belonging to state oil company Aramco in the eastern city of Dhahran was hit. Saudi Arabia's Energy Ministry said the attack caused a "limited fire" and that no casualties were reported. Escalating conflict in one of the world's largest oil producers raises the risk of disruption to global supply.

Prospects of more Russian diesel are providing some relief. Hiroyuki Kikukawa, chief strategist at Nissan Securities Investment, said supply concerns from the Saudi-Houthi fighting are pushing prices up. But he said expectations of higher Russian diesel exports could ease market tightness, limiting sharp swings in either direction. He expects WTI to trade between $90 and $100 a barrel.

The wider Middle East situation adds to the uncertainty. Reuters reported that the US-Iran war is disrupting shipping. Saudi Arabia raised oil production last month, which led to a sharp increase in OPEC+ output, OPEC said on Tuesday.

With supply risks and expectations of extra supply pulling in opposite directions, volatility in the oil market continues. Investors are now watching how the Saudi-Houthi conflict develops and whether Russia actually increases diesel exports.