Oil prices rose on Tuesday amid growing worries over supply disruption after attacks on Saudi Arabian energy infrastructure forced the kingdom's East-West pipeline offline and undercut assurances that Gulf shipping risks were easing.
At 0026 GMT, Brent crude futures were up $1.24, or 1.18%, at $106.93 a barrel, having earlier climbed about 1%. U.S. West Texas Intermediate futures gained $1.29, or 1.24%, to $102.65 a barrel, following a 1.3% rise in the previous session.
The renewed pressure on markets followed fresh attacks on Saudi Arabia on Monday by Iran-backed Houthi forces based in Yemen. Gulf Arab states also postponed planned discussions with Iran, a move that fed concerns the wider Middle East conflict could broaden and impair global oil flows.
The Houthis launched a missile and drone strike on the Khamis Mushait military airbase in southern Saudi Arabia. Saudi officials reported the attack hit aircraft hangars, radar systems, runways and ammunition depots. The action was described by the attackers as retaliation for Saudi strikes in Yemen.
These incidents came after Friday attacks on Saudi facilities that Riyadh attributed to Iranian-backed fighters in Iraq. Those earlier strikes disrupted the East-West pipeline - a strategic conduit Saudi Arabia uses to move oil to the Red Sea port of Yanbu and thereby allow exports to bypass the Strait of Hormuz.
"Oil traders are treating every fresh attack or infrastructure hit as incremental supply risk, while staying highly sensitive to any sign that the East-West pipeline or Hormuz flows could normalise," said Tim Waterer, chief market analyst at KCM Trade.
Market observation of shipping movements through the Strait of Hormuz showed a notable decline. Commodity vessel traffic fell to fewer than 10 transits a day over the weekend, down from a 10-day average of 14. The strait historically carried around one-fifth of global oil supplies before the U.S.-Israeli war on Iran began on February 28, making any drop in transits a point of strain for global crude logistics.
Buyers and traders in Saudi Arabia warned that the kingdom could begin to exhaust oil available for export within days if East-West pipeline operations are not restored. They estimated the pipeline allows rerouting of roughly 4 million barrels per day - about 4% of global supply - to Yanbu on the Red Sea. If that rerouting capability is lost for an extended period, it could tighten available export volumes materially.
"The big question for traders right now is the duration of the East-West outage. Any prolonged disruption and the associated supply loss could easily push prices to the next level higher," Waterer added.
Beyond the Middle East developments, political dynamics elsewhere also featured in market commentary. President Volodymyr Zelenskiy said on Monday that Kyiv would be willing to back a U.S. proposal for a Russia-Ukraine ceasefire limited to energy sites only if Washington could ensure that Moscow was genuinely prepared to end its war on Ukraine.
Traders and market participants are effectively pricing in the risk that each new strike or infrastructure incident represents an incremental threat to available supply. The interplay between pipeline operability, reduced transit rates through a historically vital waterway, and regional diplomatic setbacks is contributing to an environment in which crude futures are sensitive to any sign of sustained disruption.
Summary
Attacks on Saudi energy infrastructure have taken the country's East-West pipeline offline, sending Brent and WTI futures higher. Fresh Houthi strikes and postponed Gulf-Iran talks raised worries that the conflict could expand and impede oil shipments. Vessel transits through the Strait of Hormuz fell, and Saudi buyers and traders warned the kingdom could exhaust exportable oil in days if pipeline flows are not restored. Analysts say the duration of the outage will determine whether prices move materially higher.