LONDON: Brent crude oil shot up nearly 6 percent on Thursday after Saudi Arabia and its Gulf Arab allies began a military operation in Yemen, but the benchmark later came off its high near $60 as importers saw no immediate threat to supplies.
The strike against Houthi rebels, who have driven the president from Yemen’s capital Sanaa, could stoke concerns about the security of Middle East oil shipments.
OIL PRICES
jumped as traders and importers said they were worried the Saudi attack was a sign that fighting in the oil-rich Middle East was spreading and out of control.
Brent futures LCOc1 rose as high as $59.71 a barrel, up almost 6 percent since their last settlement, before dipping back to $57.96 a barrel at 0638 GMT, though still up $1.48.
U.S. crude CLc1 was up $1.76 at $50.97 a barrel.
The risk from the attack in Yemen was heightened because the Houthis have received some support from Iran, Saudi Arabia’s long-time rival for dominance in the Middle East.
“The Saudis have taken military action because they have said the Houthis are getting support from the Iranians,” said Li Guofu, director of the Centre for Middle East Studies at the China Institute of International Studies.
