Oil Declines As Tough Outlook Overshadows Middle East Tensions

Oil fell even as the US and allies pressed home their campaign against Houthi rebels in Yemen, as a tough global outlook vied with tensions in the region.

Global benchmark Brent fell below US$78 a barrel after ending higher on Friday, with West Texas Intermediate above $72. The US has followed up initial airstrikes against Houthi targets with a fresh attack on a radar installation, with the aim of repelling threats to the Red Sea route even as some tankers shied away from the waterway. The militant group has pledged to hit back.

Global oil markets have been transfixed by the evolving crisis in the region given the potential for a wider conflict that could embroil the US and Iran, endangering crude production and trade flows. The Houthis, among groups that have Tehran’s backing, have been attacking merchant ships in the Red Sea on an almost-daily basis over the past two months, vowing not to let up until Israel ends its assault on Gaza. – Bloomberg

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