Brent gains as US pledges to attack Houthis

The front-month ICE Brent contract has inched $0.49/bbl higher on the day from Friday, to trade at $71.17/bbl at 09.00 GMT.

PHOTO: Getty Images

Upward pressure:

Brent's price found support after the US pledged to continue attacking Yemen’s Houthis until the Iran-aligned group ceases its assaults on shipping.

US President Donald Trump launched military strikes against the Houthis on Saturday in response to their attacks on Red Sea shipping, according to Reuters.

“The oil price rose in response to the US launching a wave of aerial strikes on the Iran-backed Houthi rebels in Yemen over the weekend and vowing to continue until the latter agree to halt attacks on ships in the Red Sea,” said Vandana Hari, founder and analyst at VANDA Insights.

Meanwhile, data from China’s National Bureau of Statistics (NBS) showed that retail sales—a key measure of consumption—grew by 4.0% in the January-February period, surpassing the 3.7% increase recorded in December. This stronger-than-expected growth fuelled hopes for higher demand, further supporting oil prices.

Downward pressure:

The possibility of a ceasefire agreement in Ukraine continues to pressure Brent futures. Trump announced plans to speak with Russian President Vladimir Putin on Tuesday to discuss ending the Ukraine war, following positive talks between US and Russian officials in Moscow, Reuters reported.

“Trump and Putin are expected to hold a call about the Russia-Ukraine war in the next few days,” Hari said.

By Tuhin Roy

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