Oil prices advanced on Monday, supported by escalating geopolitical tensions in the Middle East and renewed optimism surrounding China’s economic recovery. West Texas Intermediate (WTI) crude for May delivery rose 68 cents, or 1%, to settle at $67.59 a barrel on the New York Mercantile Exchange. May Brent crude, the international benchmark, climbed 72 cents, or 1%, to $71.30 a barrel on ICE Futures Europe.
The gains came after U.S. President Donald Trump ordered military strikes against Houthi rebels in Yemen over the weekend. The strikes followed a warning from the Iran-backed group that they would resume attacks on commercial and military ships in the Red Sea. Defense Secretary Pete Hegseth stated on Fox News that the military campaign will continue indefinitely until the Houthis halt their assaults. “The minute the Houthis say, ‘We’ll stop shooting at your ships, we’ll stop shooting at your drones,’ this campaign will end. But until then it will be unrelenting,” Hegseth said.
The latest escalation has heightened concerns over possible disruptions in global oil supply, particularly in a region crucial to shipping routes. Patrick Munnelly, strategist at Tickmill Group, noted, Hegseth’s remarks “caused a sharp rise in oil prices during early trading in Asia on Monday, as investors grew concerned about potential supply disruptions.”
Further bolstering prices, Chinese economic data released Monday offered encouraging signals for global demand. Retail sales in China showed stronger-than-expected growth over the January-February period, suggesting progress in domestic consumption recovery efforts. However, the data also indicated a rise in unemployment and a softening of factory output, prompting expectations of additional government stimulus.
