Crude oil recovered earlier losses to trade near $95 a barrel on Tuesday, supported by mounting supply risks stemming from escalating tensions between Saudi Arabia and the Iran-backed Houthi movement. The Houthis have intensified attacks on Saudi territory since last week, targeting energy infrastructure and airports. On Saturday, they struck King Khalid International Airport in Riyadh, and on Monday a Saudi-led coalition reported it had intercepted a ballistic missile launched toward the capital.
At the same time, Iran is reinforcing security around key sites, including nuclear facilities, and mobilizing domestic and regional supporters amid speculation that the United States could resume military strikes after the November midterm elections.
Offsetting some of the upward pressure on prices, the outlook for additional Russian energy deliveries to global markets capped oil’s gains. Under a proposed arrangement, Russia would be permitted to export diesel to the United States and other markets for a six-month period. However, Goldman Sachs noted that these incremental Russian diesel shipments are unlikely to meaningfully relieve tightness in global fuel markets or significantly ease pressure on fuel prices.
