Oil prices in focus after drone attack kills three U.S. troops, escalating

Oil prices are volatile in early Monday trading after a drone strike by Iran-backed Houthi terrorists killed three U.S. service members in Jordan, in an attack that surely will raise pressure on President Biden to confront Iran directly.

Front-month March Brent crude (CO1:COM) recently traded up 0.1% to $83.09/bbl after hitting as high as $84.80/bbl, while U.S. WTI crude (CL1:COM), up 0.2% to $78.09, rose as high as $79.10/bbl on Nymex.

The attack, which also wounded at least 25 service members, marked the first American deaths from enemy fire since the start of the Israel-Hamas war.

ETFs: (NYSEARCA:USO), (BNO), (UCO), (SCO), (USL), (DBO), (DRIP), (GUSH), (NRGU), (USOI)

Late last week, a Houthi missile hit an oil tanker carrying a cargo of Russian fuel in the Red Sea, climaxing a week that saw U.S. crude oil climb to its highest since mid-November.

“While global oil prices have yet to fully reflect the escalating tensions in the Red Sea, the events of the weekend are likely to catalyze a rebasing of expected outcomes for both the security of supply as well as for oil prices,” RBC Capital analyst Michael Tran wrote in response to the events.