Solid Gold Berjangka – Oil prices rose during Wednesday's trading amid growing concerns over potential supply disruptions caused by escalating conflict in the Middle East. Brent contracts for December delivery climbed 0.61% to US$106.33 per barrel, while West Texas Intermediate (WTI) for November delivery rose 0.63% to US$94.73 per barrel.
The rise in oil prices occurred as fighting between Saudi Arabia and the Iran-backed Houthi group intensified. Tensions heightened following a deadly attack on Riyadh's main airport—attributed to the Houthi group in Yemen—amplifying market fears regarding the security of strategic infrastructure and the region's energy supply routes.
Meanwhile, Houthi energy terminals and fuel reserves in Yemen were reportedly targeted by attacks from the Saudi-led coalition. The coalition stated it had taken precautionary measures to minimize the impact on civilians. This escalation in attacks has added a geopolitical risk premium that is once again being reflected in oil prices.
Tensions between the United States and Iran also remain high, particularly concerning the Strait of Hormuz. U.S. Central Command refuted claims by a commander of Iran's Islamic Revolutionary Guard Corps Navy, who asserted that Iran controlled the strategic waterway and threatened approaching U.S. warships. This dispute has reinforced market concerns regarding the security of one of the world's most vital oil shipping lanes.
The potential for rising oil prices has also drawn the attention of commodity market participants. Hedge fund manager Paul Tudor Jones estimates that oil prices have room to rise by approximately US$20 to US$25 if the conflict with Iran persists. He also stated that he maintains a long position on oil, as he sees no signs of geopolitical risks subsiding. The market continues to monitor developments regarding the Saudi-Houthi conflict, US-Iran tensions, and the situation in the Strait of Hormuz. As long as the risk of supply disruptions remains high, oil prices have the potential to maintain a strong trend, although their future direction depends on whether geopolitical tensions escalate or begin to subside. (srh)