OIL
Brent oil prices barely moved during early Tuesday trading as investors shrugged aside the potential disruption to global supply caused by escalating tensions in the Red Sea. Houthi militants from Yemen have been attacking cargo ships in the crucial Suez route, in a development that has the potential to disrupt the main export route for Gulf oil. Such a scenario would entail re-routing sea transport between Asia and Europe to the much longer Cape route, with oil prices likely to rise in proportion to the additional costs and supply disturbance. However, the consensus amongst investors seems to be, at least for now, that the threat will be short-lived as the Yemeni militants may lack the resources to maintain attacks as the international reaction gathers pace.
Ricardo Evangelista – Senior Analyst, ActivTrades
Source: ActivTrader
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