Oil Rallies on Houthi Attack, Natural Gas Drops on Storage Build

WTI oil rebounded after the Houthis said they attacked Saudi-backed forces in Yemen. The Houthis also said Saudi Arabia is preparing to attack them, and the 2022 ceasefire between the two sides is no longer valid. The Houthis have imposed a maritime blockade on Saudi Arabia's ports. Recent reports say Saudi Arabia prefers diplomacy. The same reports say the kingdom is preparing military action if negotiations fail.

Iran said it reached an understanding with Oman on management of the Strait of Hormuz. According to Iran, a potential agreement would be valid for two to four months, and the U.S. is not part of it. The U.S. naval blockade of Iranian ports means any agreement on the strait cannot be implemented without U.S. participation.

WTI is testing resistance at $77.50 to $78.00. Above that, the 50-day moving average at $80.07 comes into view, with the next resistance at $81.50 to $82.00. On the downside, a break below $75.00 sends prices toward support at $73.00 to $73.50.

Brent oil advanced on the same escalation risk. Traders are waiting for the official announcement of the Iran-Oman agreement. Brent is trying to settle above $82.00 to $82.50. A move above $82.50 targets the 50-day moving average at $84.10, followed by $86.50 to $87.00.