Brent rose to $79.30 per barrel due to escalation in the Middle East

Oil prices are rising on Friday morning amid rising tensions in the Middle East. The current price of Brent oil is $79.30 per barrel, North American WTI oil is trading near $73.70 per barrel. 

The main reason for the price increase is geopolitical instability due to the escalation of the conflict between Israel and Hamas, as well as attacks by the Houthis, supported by Iran, on ships in the Red Sea. 

The Houthis earlier this week carried out a large-scale attack on ships using drones and missiles, which was repelled by the US military. Nevertheless, companies continue to be wary of sending their vessels through the Red Sea for security reasons.

In response to these actions, the US military and its allies launched strikes against the Houthis in Yemen. US President Joe Biden explained that the attacks on the Houthis were carried out on his instructions and with the participation of Britain, Australia, Bahrain, Canada and the Netherlands, and were aimed at facilities in Yemen used by the Houthis to threaten freedom of navigation. 

Biden called the strikes «a direct response to the unprecedented Houthi attacks on international shipping in the Red Sea.» Analysts believe that the current situation may affect 20% of fuel supplies.