Reuters_ Oil prices rose on Friday after Houthi attacks on Saudi Arabia raised fears of further energy supply disruptions from the Middle East.
By 04:39 GMT, Brent crude futures rose 58 cents, or 0.5 percent, to $113.75 a barrel, while U.S. West Texas Intermediate (WTI) crude futures rose 66 cents, or 0.7 percent, to $100.13.
Brent crude, which settled on Thursday at its highest level since May 4, is heading to close the week's trading higher for the third consecutive week. WTI crude is heading lower, ending two weeks of gains.
Reuters reported that Saudi Aramco on Thursday ordered the evacuation of its headquarters in Dhahran on the Gulf near Bahrain, as fighting intensified between the world's largest crude exporter and the Houthis in Yemen.
“Market concerns are growing over a renewed escalation in the Gulf, a scenario that could threaten oil flows that have so far remained remarkably resilient,” ING analysts said in a note on Friday.
They added, “A renewed escalation appears to be the most likely scenario. Even if tensions do not escalate again, the mere possibility of it happening is likely to keep a significant geopolitical risk premium embedded in prices.”
Fighting between the Houthis and the Saudi-led coalition supporting Yemen's internationally recognized government has intensified since the Iran-aligned Houthis advanced toward the Bab al-Mandab Strait.
“The key factors to watch now are the extent of the actual disruption and the time required to resume operations, as these two factors will ultimately determine the value of the risk premium that the market will be willing to bear for supplies,” said Linh Tran, an analyst at XS.com.
She added, “If the attacks continue and lead to delivery delays, the price increase will have a stronger foundation.”
In Libya, an oil pipeline valve extending from the Al-Hamada and Al-Tahara fields to the Zawiya port was closed, resulting in reduced production in both fields, the head of the National Oil Corporation told Reuters on Thursday.
