NYMEX crude rebounds in Asia as Saudi Arabia, allies, bomb Yemen rebels

Investing.com - Crude oil prices rebounded in Asia on Thursday with events in Yemen offering fresh support as Saudi Arabia and allies bomb Houthi rebel positions and President Abdrabbuh Mansour Hadi hangs onto power.

On the New York Mercantile Exchange, WTI crude for May delivery rose 0.99% to $49.70 a barrel.

Crude oil futures surged on Wednesday, amid increasing geopolitical risks related to the advance of the Iranian-backed Houthi rebels in Yemen.

Global oil prices spiked by more than a dollar on Wednesday afternoon, as reports surfaced that Saudi Arabia is moving heavy military equipment, including artillery to its border with Yemen.

The buildup came in response to the seizure of the al-Anad base, a Yemen airbase that had previously been used by U.S. troops in their fight against Al-Qaeda.

Yemen is strategically located on the Bab el-Mandab, a strait that connects the Gulf of Aden with the Red Sea. In mid-November, the Energy Information Administration (EIA) ranked the Bab el-Mandab the fourth-largest chokepoint in the world for global oil transport (3.8 million barrels per day).

Oil traders are sensitive to risky geopolitical news involving Saudi Arabia, which has 16% of the world's oil reserves and maintains the world's largest crude oil production capacity.

The developments in Yemen offset relatively soft inventory data released on Wednesday afternoon. In its weekly report, the EIA said that U.S. crude inventories for the week ending March 20, increased by 8.2 million barrels from the previous week.

The increase pushed U.S. crude inventories to 466.7 million barrels, its highest level in 80 years. By comparison, inventories rose 9.6 million barrels for the week ending on Mar. 13.

On the Intercontinental Exchange (ICE), Brent crude for May delivery rose 1.34 or 2.43% to $56.45 a barrel on Wednesday.