WTI rises as US, UK attack Iran-backed Houthi’s targets, trades near $73.50

West Texas Intermediate (WTI) price rises on the second consecutive day, driven by heightened concerns over potential oil supply disruptions in the Red Sea. Air strikes carried out by the United States (US) and United Kingdom (UK) targeted Iran-backed Houthis in Yemen, raising fears that the situation could escalate the Israel-Gaza conflict into a regional conflict. The WTI price improves near $73.50 per barrel during the Asian session on Friday.

President Joe Biden announced that, in collaboration with the United Kingdom and with the assistance of Australia, Bahrain, Canada, and the Netherlands, US military forces have carried out successful strikes against various Houthi locations in Yemen. Additionally, Biden emphasized that he is ready to take further actions without hesitation following the airstrikes on Houthi targets in Yemen.

Crude oil prices gained upward momentum following Iran's announcement of the capture of a civilian oil tanker “Marshall Islands-flagged St Nikolas” carrying Iraqi Crude destined for Turkey in the Gulf of Oman on Thursday. Official Iranian state media declared the seizure as a retaliatory measure against the United States' seizure of the same ship a year ago, which was headed for Iran at that time. The incident is anticipated to contribute to continued volatility in crude oil prices in the coming days.

Additionally, the recently released better-than-expected Chinese trade data for December could potentially bolster support for Crude oil products, given China's status as the largest oil importer. The Chinese Trade Balance in USD for December rose to $75.34B from the previous $68.39B, surpassing the expected $74.75B. The Exports (YoY) figure exhibited a growth of 2.3%, surpassing the expected 1.7%. Meanwhile, the yearly Imports in CNY increased by 1.6%, compared to the previous 0.6%. These positive trade figures from China may contribute to a favorable environment for Crude oil prices.