On Monday, oil price rose as the United States promised to sustain its campaign against Yemen’s Houthis until the group stops targeting international shipping. Brent crude oil rose 1.02% to $71.30 a barrel, and WTI crude oil also gained 1.1% to $67.90. The U.S. airstrikes, which killed at least 53 people, are the biggest military operation in the Middle East since Donald Trump became president. A U.S. official said the campaign could last for weeks.
The Houthi attacks have caused great disturbance to world trade, which has forced the U.S. to spend a lot of money to intercept missiles and drones. The price of oil has risen and fallen on the backdrop of the conflict and other factors. Last week, oil prices ended a three-week losing streak that had been sparked by fears of a downturn in economic activity, which had been stoked by the trade war between the United States and its partner countries.
Goldman Sachs cut its oil price forecasts on Friday, explaining that the rates have been revised lower because of weaker-than expected growth of the U.S. economy following the tariffs that President Donald Trump imposed on China, Mexico, and Canada. It also cut its December 2025 Brent price target to $71 per barrel and WTI to $67, and its 2026 Brent average target to $68.
It is predicted that demand for oil will increase at a slower rate than expected, while supply from OPEC and its partners is expected to be higher than earlier projected. However, U.S. consumer sentiment has tanked with the inflation fear rising on the back of Trump’s aggressive tariff policies.
The Federal Reserve is anticipated to leave its interest rates unchanged at 4.25%-4.50% as policymakers monitor the impact of trade policies and geopolitical risks on the economy.
