BP the latest to pause Red Sea shipping as Houthi attacks increase
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BP the latest to pause Red Sea shipping as Houthi attacks increase

BP the latest to pause Red Sea shipping as Houthi attacks increase

BP has temporarily paused all transits through the Red Sea while oil tanker group Frontline said its vessels would avoid passage through the waterway.

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Oil prices were mixed on Tuesday, with the US benchmark dipping while Brent extended gains from the previous session, as attacks by Yemen’s Houthi militants on ships in the Red Sea disrupted maritime trade and forced companies to reroute vessels.

Brent crude futures rose 10 cents, or 0.13 per cent, to $78.05 a barrel at 0330 GMT. The front-month US West Texas Intermediate crude futures contract, which expires on Tuesday, fell 7 cents to $72.40 a barrel. The more active second-month contract was down 5 cents, or 0.07 per cent, to $72.77.

Both benchmarks rose more than 1 per cent on Monday on concerns about shippers diverting vessels away from the Red Sea.

“Despite price stabilisation today, the potential risks caused by supply disruptions and the Middle East unrest could bring significant volatility to oil markets,” said Tina Teng, an analyst at CMC Markets in Auckland.

“Oil markets may face further upside pressure if geopolitical tensions get escalated,” she added.

Oil major BP temporarily paused all transits through the Red Sea and oil tanker group Frontline said on Monday its vessels would avoid passage through the waterway, signs the crisis was broadening to include energy shipments.

About 15 per cent of world shipping traffic transits via the Suez Canal, which connects the Red Sea to the Mediterranean Sea, offering the shortest shipping route between Europe and Asia.

The shipping attacks have prompted the US and its allies to discuss a task force that would protect Red Sea routes, a move that US and Iran has warned would be a mistake.


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