West Texas Intermediate (WTI), the U.S. crude oil benchmark, is trading around $67.30 in early Asian markets on Tuesday, extending its rally as geopolitical tensions in the Middle East escalate.
The price surge follows U.S. military actions against Yemen’s Houthi rebels, who claimed responsibility for a large-scale attack on the USS Harry S. Truman aircraft carrier and its warships in the northern Red Sea. The assault, launched on Sunday, involved 18 ballistic and cruise missiles along with drones. A Houthi military spokesperson stated that the offensive was in response to U.S. airstrikes on rebel-controlled territories, including Sanaa and Saada, which were authorized by former President Donald Trump.
President Trump, who recently returned to the White House, warned on Monday that Iran would be held accountable for any Houthi-led attacks. His administration has since expanded the largest U.S. military operation in the Middle East in recent years. The ongoing conflict has disrupted key shipping routes, increasing energy transportation costs and further driving up WTI prices.
Adding to the bullish sentiment, China’s latest economic measures have boosted oil demand expectations. The Chinese government announced a special initiative to stimulate domestic consumption and stabilize financial markets, including efforts to bolster the stock and property sectors. As a result, China’s retail sales grew 4% in the first two months of the year, up from 3.7% in December.
However, concerns over Trump’s protectionist trade policies could weigh on oil prices. His aggressive tariffs on imports may raise costs for businesses, fuel inflation, and dampen consumer confidence, posing a risk to global economic growth and energy demand.
