West Texas Intermediate (WTI) and Brent crude oil prices surged on Monday following Yemen’s Iran-sponsored militant group, Houthis, launching their first missile attacks on Israel since the start of the conflict, marking a significant escalation in the ongoing U.S.-Israel war with Iran [1][2]. WTI extended its winning streak for the fourth consecutive trading day, topping $100 per barrel and aiming for a three-year high of $113.28 [1]. U.S. WTI futures rose 3.20% to $102.80 per barrel, while May futures for Brent crude climbed 2.92% to $115.86 per barrel during early Asia hours [2].
The attacks by Houthis, which were confirmed by spokesperson Yahya Saree in a post on X, involved a barrage of ballistic missiles targeting sensitive Israeli military sites in support of Iran and Hezbollah forces in Lebanon [2]. The conflict began on February 28 after U.S. and Israeli strikes on Iran, and the recent expansion to include the Houthis has intensified concerns over energy supply disruptions, particularly with the ongoing blockade of the Strait of Hormuz and potential threats to Red Sea shipping [1][2].
Market analysts highlighted the implications of these developments. Ed Yardeni, president of Yardeni Research, noted that global equities are beginning to reflect expectations of "higher-for-longer" oil prices and interest rates due to the risk of a prolonged conflict [2]. He warned that the continued blockade of the Strait of Hormuz could deepen the market pullback and raise recession risks, with uncertainty around the conflict and the possibility of greater U.S. involvement likely to keep volatility elevated until oil flows normalize [2]. Yardeni emphasized that the rapid repricing of geopolitical risk in energy markets is challenging previous efforts to stabilize both oil and bond markets, reinforcing the risk of sustained disruption in the Strait [2].
All eyes remain on further potential attacks by Houthis, a possible U.S. ground military operation into Iran, and ongoing peace talks between the U.S. and Iran for fresh trading impetus in oil prices [1].
CONCLUSION
The escalation of the Middle East conflict, with Houthis entering the fray and targeting Israel, has driven oil prices sharply higher and heightened concerns about global energy supply disruptions. Analysts warn that continued instability and blockades could deepen market pullbacks and increase recession risks, with volatility expected to persist until oil flows normalize. The market is closely watching for further developments and potential diplomatic resolutions.