Brent crude oil price rises to $79 a barrel

Brent crude price rose by 2. 3% to $79 per barrel on Friday, January 12 2024.

A review of global crude oil prices as of 01:54 GMT+1, revealed that Brent was trading $79.22 per barrel.

Experts observed that the increase in prices of Brent crude and West Texas Intermediate (WTI) benchmarks occurred due the United States and Britain carried out strikes against Houthi military targets in Yemen in retaliation for attacks by the Iran-backed group on shipping in the Red Sea starting from late last year.

According to Reuters, the recent U.S. and British airstrikes represent a significant and dramatic escalation in the ongoing Israel-Hamas conflict in the Middle East, which began in October. Reports from Yemen indicate widespread explosions throughout the country.

U.S. President Joe Biden said the “targeted strikes” were a clear message that the United States and its partners will not tolerate attacks on its personnel or “allow hostile actors to imperil freedom of navigation”.

Australia, Bahrain, Canada and the Netherlands supported the operation, he said.

15% Rise in World Shipping Traffic 

• Moreover, Houthi assaults in the Red Sea have disturbed global trade along the crucial route connecting Europe and Asia, constituting approximately 15% of the world’s maritime traffic. 
• Since October, the Houthis have targeted commercial ships in the Red Sea as a demonstration of solidarity with the Palestinian militant group Hamas in its conflict against Israel. 
• As a result, Maersk, the shipping giant (MAERSKb.CO), announced on Thursday its decision to reroute all vessels away from the Red Sea indefinitely, cautioning customers about potential additional disruptions. 
• The recent U.S.-led strikes come shortly after Iran seized a tanker on Thursday, carrying Iraqi crude intended for Turkey. This action is seen as retaliation for the U.S. confiscating the same vessel and its oil last year.  
• The White House has expressed condemnation for the seizure. 
• The Houthi attacks have been concentrated on the Bab al-Mandab Strait to the southwest of the Arabian Peninsula. Iran’s seizure was closer to the Strait of Hormuz between Oman and Iran.