Oil Prices Drop Over 2% Amid Saudi Arabia Security Concerns

Oil futures fell more than 2% on Monday. The move comes as the market assesses the impact of attacks on energy facilities in Saudi Arabia.

WTI crude dropped 2.19% to trade at 101 dollars per barrel. Brent crude fell 1.89% to reach 114.51 dollars. The decline follows a sharp rally observed last Friday.

Tensions persisted over the weekend after Houthi militant attacks targeted Saudi airports and processing units. Local authorities confirmed the interception of missiles and drones although the infrastructure remains under constant threat of further damage.

Analysts note that geopolitical uncertainty added about 20 dollars to the price of each barrel. There is growing concern that high prices could destroy global energy demand. Furthermore, damage to refineries may create long-term structural issues for the sector.

The United States government authorized the release of 400,000 barrels from its strategic reserve to mitigate problems at a refinery in Louisiana. Meanwhile, Saudi Arabia plans to store oil in Singapore starting in 2027 to strengthen its Asian supply chain.