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02.01.202409:00:00UTC+00Oil Prices Rally After Fresh Red Sea Attacks

Oil prices rose over 2 percent on Tuesday amid concerns of potential supply disruptions in the Middle East.

Benchmark Brent crude futures jumped 2.1 percent to $78.68 a barrel, while WTI crude futures were up a little over 2 percent at $73.11.

Both benchmark contracts plunged over 10 percent in 2023 on concerns over sluggish demand and higher-than-expected supply conditions.

The risks of the Israel-Gaza conflict morphed into a wider regional conflict after U.S. helicopters repelled an attack on Sunday by Iran-backed Houthi militants on a Maersk container vessel in the Red Sea, a vital trade route between Europe and Asia.

Iran, meanwhile, sent a warship to the Red Sea in response to the U.S. Navy's sinking of three Houthi boats over the weekend that had killed about 10 Houthi fighters.

Hopes for strong Chinese demand also lifted oil prices after a private survey showed China's factory activity expanded at a quicker pace in December due to stronger gains in output and new orders.

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