Oil prices have hiked by 1$ on Tuesday and the hike is highest in seven years. Businesses around the world are worried about supply disruptions that might arise due to attack of Houthi group on UAE. The attacks have increased hostilities between Iran Aligned Group and Saudi Arabian led coalition. Brent Crude, US West Texas Intermediate Crude observed price hike.
According to analyst and experts the geo political tension in Middle East is the cause of hike in oil prices in the market.
The prices of Brent Crude have increased by $ 1.01 to $ 87.48 per barrel. The prices also increased to $ 87.55 per barrel, highest since October 29, 2014.
The prices of US West Texas Intermediate Crude jumped by $ 1.32 and recorded highest price in three months of $ 85.14 per barrel.
Houthi Movement of Yemen launched drone and missile strikes on fuel trucks which killed three people. The Movement has threatened that it would target more facilities. UAE has not submitted an official response regarding terrorist attacks.
ADNOC, one of the largest oil firms in UAE suffered attack at Mussafah Fuel Depot. The company has said that it has plans to ensure that there is no gap in supply of oil barrels to its local and international customers.
The experts have said that the imbalance in supply-demand will not ease out quickly. Many producers in Organization of the Petroleum Exporting Countries are not able to meet the demands due to underinvestment and outages.
The rise in prices will affect the businesses and India will be affected as well. With a plunging economy the news comes bearing red flags for the country.