Oil prices climbed Tuesday, extending a three-day winning streak as tensions in the Middle East escalated following U.S. strikes against Iran-backed Houthi militants in Yemen.
West Texas Intermediate (WTI) crude advanced 1.5% to $68.60 per barrel, while Brent crude rose 1.4% to $72.07 per barrel.
Traders and analysts are also monitoring a planned call between U.S. President Donald Trump and Russian President Vladimir Putin about a possible cease-fire in Ukraine. A negotiated pause in hostilities could influence global energy markets if it leads to the restoration of Russian energy exports or eases broader geopolitical risk.
Market participants cite several factors supporting the recent price gains: heightened geopolitical risk in the Red Sea and Gulf of Aden region, which threatens shipping routes and raises insurance costs; tightened supply expectations as regional producers reassess operations; and ongoing demand resilience despite concerns about global economic growth.
Analysts say that if tensions persist or escalate further, risk premiums on crude could increase, keeping prices elevated. Conversely, progress toward a cease-fire in Ukraine or assurances about uninterrupted Russian energy flows could reduce uncertainty and cap further upside.
For now, oil traders remain sensitive to news from both the Middle East and diplomatic developments involving major energy producers. Short-term volatility is likely to continue as market participants weigh supply disruptions against demand indicators and macroeconomic signals.