Oil prices advanced in Asian trading Thursday after Houthi militants' latest attacks on Saudi Arabia, keeping U.S. Treasury yields elevated after touching a fresh multiyear high overnight.
Houthi militants escalated their conflict with Saudi Arabia, attacking two airports in the kingdom. The assault on King Khalid International Airport in Riyadh killed a Sudanese national and wounded eight other people. A separate attack on the airport in the southern city of Abha, about 400 miles from the Yemeni border, killed two people and wounded 28 others, Saudi Arabia's General Authority of Civil Aviation said.
The two attacks, which took place on Tuesday and Wednesday, have deepened the Saudi-Houthi conflict that threatens to further disrupt oil supplies through the Bab al-Mandeb Strait, a vital chokepoint in the global energy network.
"Attacks on vessels in the Middle East continued," ANZ Research analysts said in a research report. "The U.K. Maritime Trade Operations has reported at least nine attacks in the" Strait of Hormuz so far this month, the analysts noted, adding this amount was already half the number recorded for the entire month of September.
The ten-year Treasury yield inched higher in Asian trade, after it briefly touched a 24-year high of 5.361% overnight before pulling back. The attacks in the Middle East kept investors focussed on higher oil prices and their impact on inflation.
Investors also parsed minutes of the Federal Open Market Committee's September meeting where the Federal Reserve tightened monetary policy.
"The September FOMC minutes offered few surprises," strategists at OCBC Group Research said. "Policymakers reiterated that the 25bp rate hike was intended to support a faster return of inflation to the Fed's 2% target, while most participants judged that another rate increase would likely be appropriate before year-end," the strategists added.
The 10-year Treasury yield was recently up 3 basis points at 5.307%, LSEG data showed.
Yields on Asian government bonds edged lower as Australia's 10-year government bonds lost 2.1 basis points to 5.393% and New Zealand's 10-year sovereign debt yield shed 0.5 basis point to 5.135%. The yield on Japan's 10-year government bonds was 2.5 basis points lower at 3.084%.
Front-month West Texas Intermediate crude oil futures rose 1.8% to $89.86 a barrel while front-month Brent crude oil futures gained 2.15% to $102.35 a barrel, according to ICE data.
Equity markets across Asia fell in the wake of Wednesday's declines in European and U.S. stock markets.
Japan's Nikkei Stock Average was recently down 0.9%, South Korea's Kospi was down 1.6%, and Hong Kong' Hang Seng Index declined 0.7%. China's Shanghai Composite Index slipped 0.3% as markets reopened after a weeklong holiday.
Semiconductor stocks led the declines. Chinese chip foundry Semiconductor Manufacturing International Co. tumbled 5.1% in Hong Kong and memory maker CXMT lost 6.8%.
South Korea's Samsung Electronics dropped 1.6% as its third-quarter preliminary earnings surged but nevertheless failed to meet the market's lofty expectations.