Oil up in early Monday trade

Oil rose in early Monday trade. Brent crude went up by 0.20 per cent, or 0.16 cents to reach $78.45 a barrel at 03:04 am CDT.

West Texas Intermediate (WTI) climbed by 0.15 per cent, or 0.11 cents, to trade at the price of $72.79 a barrel.

Following the U.S. and the British strikes on the Houthi militia in Yemen, investors are still on the lookout for supply disruption risks in the Middle East. The strikes boosted oil prices by more than 2 per cent last week.

“There are supply risks for the market given the escalation in Red Sea,” Warren Patterson, head of commodities research at ING told Reuters.

“However, for now we are not seeing any impact on oil supply. And I guess we would need to see significant escalation before that happens.” He added.

After the U.S. launched another strike overnight, raising tensions, the Houthi militia threatened a “strong and effective response” on Sunday. Later, the U.S. claimed to have shot down a missile fired from Houthi militant areas in Yemen that was aimed at one of its ships.

In response to the strikes, many tanker owners chose to avoid the waterway, while several tankers altered their course on Friday. Moreover, traders still keeping an eye out for Iran’s response and its potential impact on shipments in the Strait of Hormuz, the world’s most significant oil chokepoint.

Meanwhile, after closing the 300,000 barrel-per-day Sharara field on January 7, protesters in Libya threatened to close two more oil and gas facilities.

With record-breaking temperatures predicted for the Martin Luther King Jr. holiday weekend, power and natural gas companies in the United States were bracing for a shortage of gas due to frozen wells.