Oil prices over 1% after Yemeni extensive military operation on Saudi Aramco
Oil prices rose over 1% on Tuesday after top exporter Saudi Arabia said explosive-laden drones launched by the Yemeni army had attacked facilities belonging to state oil company Aramco.
That move higher comes as the market waits for a report from the American Petroleum Institute (API), an industry group, which is expected to show U.S. crude stockpiles fell by 800,000 barrels last week, their second decline in a row, according to analysts in a Reuters poll.
The poll was conducted ahead of weekly reports from API at 4:30 p.m. EDT (2030 GMT) on Tuesday and the U.S. Energy Information Administration (EIA) at 10:30 a.m. EDT on Wednesday.
Brent futures gained $1.01, or 1.4 percent, to settle at $71.24 a barrel, while U.S. West Texas Intermediate crude gained 74 cents, or 1.2 percent, to $61.78.
That was the highest settle for Brent since May 6 and WTI since May 8 and caused the closing premium of Brent over WTI to rise to a nine-week high.
U.S. oil output from seven major shale formations, however, is expected to rise to a fresh peak of about 8.5 million barrels per day in June, the U.S. Energy Information Administration said in a report on Monday.
Seven drones run by Yemeni army forces reportedly carried out attacks against vital Saudi facilities in response to the Saudi-led coalition, backed by the US, regime’s ongoing acts of criminal practices against Yemeni people.
A Yemeni military source told al-Masirah TV on Tuesday that the extensive military operation was conducted in retaliation for the coalition’s deadly military war and the siege of the impoverished Arabian Peninsula state.
“We are ready to carry out more qualitative and cruel strikes in the event of continued aggression and unjust siege,” the official added.
Yemen’s Ansarullah confirmed they launched the seven drones against vital installations in Saudi Arabia, which borders Yemen to the north. Saudi Arabia has been at war against Yemen since March 2015.
“This is a message to Saudi Arabia: Stop your aggression,” spokesman of the national delegation, Mohammed Abdel-Salam told The Associated Press. “Our goal is to respond to the crimes they are committing everyday against the Yemeni people.”
The oil pumping stations targeted in Saudi Arabia are over 800 kilometers from Yemen’s northern border with the kingdom.