U.S. crude oil fell 2.19% to $101 a barrel and Brent declined 1.89% to $114.51 after a sharp rally triggered by Houthi attacks on Saudi Arabian facilities. The Houthis targeted the main airport in Riyadh and oil facilities, while Saudi authorities intercepted additional missiles and drones and partially resumed airport operations. Michael Alfaro, chief investment officer at Gallo Partners, said geopolitical uncertainty has added roughly $20 per barrel to oil prices; a major strike on Saudi pipelines or refineries could push prices higher, but Brent above $120, $130 or $140 would accelerate demand destruction. Damage to refining capacity could become a structural market problem extending into 2027 and beyond, while Saudi Arabia plans to start storing crude oil in Singapore in the second half of 2027. In the United States, the Energy Department authorized the release of up to 400,000 barrels from the Strategic Petroleum Reserve, but producers remain cautious about major investment because of volatile prices and geopolitical risks.
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