Oil Prices Rise as US Pulls Diplomats from Saudi Arabia Amid Houthi Attacks

Oil prices edged higher on Thursday after the United States instructed diplomats and family members to leave its missions in Saudi Arabia following a series of attacks by Yemen's Houthi rebels. Brent crude futures rose $1.29, or 1.2%, to $110.11 a barrel, while U.S. West Texas Intermediate gained 97 cents, or 1%, to $98.12.

The State Department said it will also withdraw family members from several other U.S. missions in the region. Houthi strikes on Wednesday hit a civilian airport in Dammam, killing one person and wounding eight, and a drone attack on a Saudi oil field killed two. Explosions were reported in Sirik, southern Iran, though the cause remains unclear.

Iran's foreign minister told the Financial Times that Tehran is prepared to defend itself, and a senior Iranian official said the United States cannot expect dialogue while it continues blockades and threats. Data from Kpler showed at least 18 attacks on shipping in the past two weeks, and analysts warned that Iranian targeting of tankers extends beyond the Strait of Hormuz into the Gulf of Oman, threatening regional crude loadings and ship-to-ship transfers.

In a separate development, Russian President Vladimir Putin met U.S. Special Envoy Steve Witkoff in St. Petersburg to discuss restarting U.S.-mediated peace talks on Ukraine, with the Kremlin indicating talks could resume as early as next month.

U.S. crude inventories fell by 3.06 million barrels to 412.5 million barrels last week, according to the Energy Information Administration, while distillate stockpiles rose 1.68 million barrels. The Trump administration announced that the Department of Energy will loan up to a third of the one-million-barrel emergency heating oil reserve to help ease price pressures linked to diesel shortages stemming from the conflicts in Iran and Ukraine.