On Friday, oil prices surged over 2% following strikes by the United States and Britain against Houthi military targets in Yemen. The strikes were in response to attacks by the Iran-backed group on shipping in the Red Sea since late last year.
Futures rose $1.53, or 2%, to $78.94 a barrel, while U.S. West Texas Intermediate crude futures were trading $1.53, or 2.1% higher, at $73.55 at 0337 GMT.
Benchmarks rose nearly 1% from the previous day, ensuring prices are on track for a second straight weekly gain.
The US and British strikes are one of the most dramatic demonstrations of the widening war between Israel and Hamas in the Middle East since it erupted in October. Reports from witnesses in Yemen verified explosions occurring across the country.
US President Joe Biden said the “targeted strikes” were a clear message that the United States and its partners would not tolerate attacks on its personnel or “allow hostile actors to threaten freedom of navigation”.
Australia, Bahrain, Canada, and the Netherlands expressed their support for the operation.
The Houthi attacks in the Red Sea have disrupted international trade on the key route between Europe and Asia, which accounts for about 15% of world shipping.
Since October, the Houthis have attacked merchant vessels in the Red Sea to show support for the Palestinian militant group Hamas in its fight against Israel.
Shipping giant Maersk said on Thursday it would divert all vessels away from the Red Sea for the foreseeable future and warned customers of further disruptions.
The US-led strikes are also closely following Iran’s seizure of a tanker carrying Iraqi oil bound for Turkey on Thursday in retaliation for the US confiscation of the same vessel and its oil last year. The White House condemned the seizure.
Houthi attacks have been concentrated on the Báb al-Mandab strait in the southwest of the Arabian Peninsula. Iran’s seizure was closer to the Strait of Hormuz between Oman and Iran, which analysts say is a major problem.
“The Gulf of Oman is very close to the Strait of Hormuz, a critical point for oil flows. More than 20 million barrels of oil flow through the Strait of Hormuz per day, equivalent to around 20% of global consumption,” ING analysts said in a note.