Oil climbs past $110 as Houthi strikes prompt US diplomatic pullback from Saudi Arabia

Oil prices rose on Thursday (October 22, 2026) after further attacks by the Houthis in Saudi Arabia prompted the United States to order some diplomats and family members to leave its missions in the Kingdom.

Brent crude futures rose $1.29, or 1.2 per cent, to $110.11 a barrel at 00:34 GMT, while U.S. West Texas Intermediate crude gained 97 cents, or 1 per cent, to $98.12. Brent had settled largely unchanged on Wednesday (October 21, 2026), while WTI had eased 67 cents.

U.S. officials told the news agency Reuters that the State Department also plans to withdraw family members from a number of other U.S. missions in the region.

Yemen's Iran-aligned Houthis struck several targets on Wednesday (October 21, 2026). At least one person was killed and eight more wounded at a civilian airport in Dammam, and two people were killed in a drone attack on a Saudi oil field, according to reports of the incidents.

Explosions were also heard in Sirik in southern Iran, Iranian media reported on Wednesday (October 21, 2026), saying the nature and origin of the blasts were unknown.

Iran's Foreign Minister Abbas Araqchi told the Financial Times on Wednesday that Iran was fully prepared to defend itself. President Masoud Pezeshkian told state media that the United States could not expect dialogue while, in his words, blockading and threatening Iran.

Shipping data pointed to widening risks at sea. Kpler data showed at least 18 attacks on shipping over the past two weeks, while LSEG analysts warned that Iran was targeting tankers well beyond the Strait of Hormuz, reaching into the Gulf of Oman and jeopardising Gulf crude loadings and ship-to-ship transfers that support regional loadings.

The Strait of Hormuz is among the world's most closely watched oil chokepoints, and any disruption to transit through it or to nearby loading operations tends to be reflected quickly in crude prices. For import-dependent economies, including India, which buys most of its crude from overseas, sustained increases in benchmark prices can feed through to transport, freight and fuel costs over time.

Separately, Russian President Vladimir Putin hosted U.S. Special Envoy Steve Witkoff in St. Petersburg on Wednesday (October 21, 2026) for talks on ending the war in Ukraine, amid Washington's latest push to stop Europe's bloodiest conflict since World War Two. The Kremlin said Mr. Putin had agreed to resume U.S.-mediated peace talks with Ukraine as soon as next month. Ukrainian President Volodymyr Zelenskiy said he supported the talks and hoped they would start as soon as possible.

On the supply side, U.S. crude stocks fell by 3.06 million barrels to 412.5 million barrels last week, the U.S. Energy Information Administration said on Wednesday (October 21, 2026). Analysts polled by Reuters had expected a draw of 820,000 barrels. Distillate stockpiles, which include diesel and heating oil, rose 1.68 million barrels in the week to 104.3 million barrels, against expectations of a 1.16 million-barrel drop, the EIA data showed.

The Trump administration is offering to loan up to nearly a third of the 1-million-barrel U.S. emergency heating oil reserve, the Department of Energy said on Wednesday (October 21, 2026). The move is aimed at containing prices that have surged amid diesel shortages linked to the wars in Iran and Ukraine.

Traders are expected to keep a close watch on diplomatic movements in the Gulf and on any further reported strikes on energy infrastructure or shipping in the coming days.