'Inflationary pressure!' Oil price hits HIGHEST level since 2014 after UAE drone attack

FTSE: Crude oil prices fluctuate due to coronavirus fears

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The Iran-backed Yemeni Houthi rebels claimed responsibility for the drone attack which took place in Abu Dhabi on January 17. The incident led to explosions in fuel tanker trucks and resulted in the death of three people.

However, and following the Saudi-led coalition responding through retaliatory airstrikes on Sanaa, oil prices have surged.

It is thought prices are on the rise as a result of growing optimism as the world continues to recover from the coronavirus pandemic.

It has also been suggested concerns about the attack on the UAE, a nation in which oil accounted for 29 percent of gross domestic product in 2020, and expectations of a surge in demand have helped push prices to their highest levels since October 2014.

Brent crude, which is considered the international benchmark for oil prices, rose by almost 1 percent to $87.22 per barrel.

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Yemen's Houthi rebels, backed by Iran, have taken responsibility for the attack

Yemen’s Houthi rebels, backed by Iran, have taken responsibility for the attack (Image: Getty)

A fire broke out on a construction site at Abu Dhabi International Airport as a result of the strike

A fire broke out on a construction site at Abu Dhabi International Airport as a result of the strike (Image: Getty)

West Texas Intermediate crude, which is the measure in America, suggests the US has witnessed an even steeper price rise.

Prices rose by 1.3 percent to hit $84.89 per barrel.

AJ Bell’s investment director Russ Mould said: “Traders are eyeing the $100 per barrel mark for crude oil for the first time since 2014, with the perceived diminishing threat posed by Omicron to the global economy and supply constraints and disruption driving the black stuff higher.

“A rise in oil prices to a seven-year high and a continuing, though below inflation, rise in UK earnings has put the spotlight once again on inflationary pressures and a cost of living crisis.”

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Mohamed al-Bukhaiti warned that further strikes will take place

Mohamed al-Bukhaiti warned that further strikes will take place (Image: Getty)

Rising oil prices could take their toll on Brits.

According to the RAC, start-of-month fuel prices per litres reached record highs in November 2021 when British car users were paying 147.28p per litre for unleaded petrol and 150.64p per litre for diesel.

At the start of 2021, the price stood at just 116.51p per litre for unleaded petrol and 120.05p per litre for diesel.

Inflation in the United Kingdom has also outgrown average pay rises as Brits look set to face a cost of living crisis.

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The UK braces for a cost of living crisis

The UK braces for a cost of living crisis (Image: Getty)

Petrol prices

Petrol prices (Image: Getty)

The Office for National Statistics said: “Salaries are growing reasonably strongly, but some people are saying they are not feeling much better due to rising prices.”

Weekly wages, when excluding bonuses, rose by 3.8 percent in the three months to November compared to the same period a year earlier.

However, the consumer price index points out inflation has risen to a 30-year high at 5.4 percent.

The Bank of England has claimed inflation is expected to rise even further and could reach 6 percent by April.

According to the Bureau of Labor Statistics, the US inflation rate rose to its highest point since 1982 when it rose to 6.8 percent in December.

William Murphy

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