Oil jumps 1% after Houthis attack another fuel tanker in the Red Sea

Oil prices jumped 1 per cent on Monday on fuel supply concerns after a missile struck a Trafigura-operated fuel tanker in the Red Sea and as Russian refined products exports are set to fall as several refineries are under repair after drone attacks.

Brent crude futures climbed 83 cents to $84.38 a barrel after hitting a session-high of $84.80. US West Texas Intermediate crude rose 78 cents to $78.79 a barrel.

READ MORE: Oil at highest point in nearly 8 weeks: Will it impact fuel prices at the pump?

Commodities trader Trafigura said on Saturday it was assessing the security risks of further Red Sea voyages after firefighters put out a blaze on a tanker attacked by Yemen’s Houthi group a day earlier.

“Disruptions to supply have been limited, but that changed on Friday after an oil tanker operating on behalf of Trafigura was hit by a missile off the coast of Yemen,” ANZ analysts said in a note.

“With oil tankers linked to the US and UK now under threat of attack, the market is likely to reprice the risk of disruptions.”

Both contracts rose for a second week in a row and settled at their highest in nearly two months on Friday, supported by Middle East and Russian supply concerns while positive US economic growth and signs of Chinese stimulus boosted demand expectations.

Russia will likely cut exports of naphtha, a petrochemical feedstock, by some 127,500 – 136,000 barrels per day, or around a third of its total exports, after fires disrupted operations at refineries on the Baltic and Black Seas, according to traders and LSEG ship-tracking data.

On February 1, leading ministers from the Organisation of the Petroleum Exporting Countries (OPEC) and those part of OPEC+, will meet online.