WTI advances near $74.70 on Red Sea disruptions, more vessels to avoid the Suez Canal

West Texas Intermediate (WTI) price trades higher around $74.70 per barrel at the time of writing, extending gains for the second successive day. The geopolitical developments in the Middle East highlight the complexities surrounding maritime security and global trade following the Houthi attacks on ships in the Red Sea. These events serve as a significant factor contributing to the surge in crude oil prices.

The decision of more shipping companies, including Germany's Hapag-Lloyd and Hong Kong's OOCL, to steer clear of the Suez Canal underscores the escalating concerns in the Red Sea. Following an attack on a Norwegian commercial vessel by the Iran-led Houthi militant group on Monday, major player British Petroleum temporarily halted all transit through the waterway.

In response, Washington has taken proactive steps by establishing a dedicated task force to safeguard Red Sea commerce, emphasizing the importance of addressing and mitigating risks stemming from attacks on commercial vessels in the region. On the other hand, the Houthis remain defiant, pledging to continue their attacks despite the US-led naval mission.

Additionally, Angola's recent decision to exit the Organization of the Petroleum Exporting Countries and its allies (OPEC+) adds another layer to the evolving geopolitical landscape. Angola's Oil Minister, Diamantino Azevedo, has emphasized that the country's interests were not being adequately served within the group. This move aligns Angola with other mid-sized producers like Ecuador and Qatar, who have also departed from the group over the past decade.

Market participants will likely observe Baker Hughes US Oil Rig Count data release on Friday to gain fresh impetus on business conditions in the drilling industry.