Oil prices jumped more than 3% on Monday as attacks on Saudi Arabian infrastructure and faltering diplomatic efforts intensified concerns over Middle East supply.
Brent crude was trading around $108.20 a barrel, up 3.5%, while West Texas Intermediate gained 3.7% to about $103.70, according to the latest market pricing. Both benchmarks have pushed firmly back above $100 after last week's escalation.
The latest move followed the shutdown of Saudi Arabia's East-West pipeline after drone attacks launched from Iraq damaged the route. The pipeline can carry up to 7 million barrels a day and has become increasingly important as disruption through the Strait of Hormuz restricts Gulf exports.
Diplomatic hopes also weakened after a planned meeting between Iran and Gulf Arab states in Oman was postponed. The talks had been expected to discuss shipping arrangements through Hormuz, where crude flows remain well below pre-war levels.
Meanwhile, Houthi advances in Yemen have added a second pressure point around the Arabian Peninsula. The group has reportedly seized Perim Island in the Bab al-Mandab Strait after taking the port of Mokha, strengthening its position around another key global shipping route.
The renewed oil surge is also feeding back into inflation concerns. Higher crude and fuel prices have pushed up bond yields and revived expectations that central banks may need to keep monetary policy tighter, with Goldman Sachs warning that further energy-price spikes could rekindle recession risks.
