Oil rose for a fifth day in New York as Saudi Arabia bombed rebel targets in Yemen with its allies, renewing concern conflict will spread in the Middle East.
Futures surged as much as 5.6 percent and headed for the biggest rally over five days since at least February 2011. King Salman ordered airstrikes against Shiite Houthi positions after an appeal from Yemen’s President Abdurabuh Mansur Hadi. Prices slid earlier Thursday after a government report showed U.S. crude stockpiles and production swelled last week to the highest levels in more than three decades.
While the expanding glut in the U.S. and OPEC’s decision to maintain its output target have driven prices to a six-year low, the Saudi offensive brings the market’s focus back to the Middle East and the potential for a supply disruption in the world’s largest oil-producing region. Yemen’s sits on a chokepoint in international shipping, making it important for global energy trade, according to the Energy Information Administration.