Oil slides over 2% as traders weigh Saudi attack risks, demand destruction

Livestream Menu Oil fell as investors weighed the threat of further attacks on Saudi Arabian energy infrastructure against concerns that elevated prices could eventually erode demand. The pullback followed a sharp rally on Friday after attacks by Yemen's Houthi militants on Saudi Arabia reignited fears of disruptions to global energy supplies. @LCO26Z A pumpjack operates after sunrise in Kern County, which has a long history of oil production, in California’s 22nd Congressional District on Oct. 16, 2026 near Bakersfield, California. S. crude oil fell over 2% on Monday as investors weighed the threat of further attacks on Saudi Arabian energy infrastructure against concerns that elevated prices could eventually erode demand. West Texas Intermediate futures slid 2.19% to $101 a barrel, while Brent crude futures declined 1.89% to $114.51 a barrel. Oil prices year-to-date The pullback followed a sharp rally on Friday after attacks by Yemen's Houthi militants on Saudi Arabia reignited fears of disruptions to global energy supplies. Tensions remained elevated over the weekend as the Houthis said they had targeted Saudi Arabia's main airport in Riyadh and oil facilities on Saturday. Saudi authorities said Sunday that they had intercepted additional missiles and drones. The kingdom partially resumed operations at its main airport on Sunday despite damage from earlier attacks, even as the Houthis threatened further strikes. The continued hostilities have heightened concerns about the vulnerability of Saudi Arabia's energy infrastructure, with traders increasingly focused on the risk of a major disruption to production, refining or export facilities. Speaking to CNBC, Michael Alfaro, chief investment officer at Gallo Partners, estimated that geopolitical uncertainty had already added roughly $20 a barrel to oil prices. Beyond the immediate threat to crude supplies, damage to refining infrastructure could pose a more persistent challenge to global energy markets. "The real challenge is refining capacity," he said, warning that the disruptions could develop into a longer-term structural problem extending into 2027 and beyond. Meanwhile, Saudi Arabia plans to begin storing crude oil in Singapore from the second half of 2027, according to energy ministers from both countries, in a move aimed at strengthening the resilience of its Asian supply chain. S., the Energy Department on Friday authorized the release of up to 400,000 barrels from the Strategic Petroleum Reserve to address a supply disruption at a Louisiana refinery. Still, the prospect of additional supply from American producers remains uncertain, with companies reluctant to commit to major new investments amid volatile prices and geopolitical risks.