Sterling Slides to Five-Week Low as Energy Jitters Grip Markets

Crude oil prices climbed more than 2% to reach $108.2 per barrel, a sharp reaction to supply disruptions triggered by Houthi assaults on Saudi Arabian infrastructure. The closure of the kingdom’s East-West Pipeline has intensified fears regarding the security of energy transit routes, directly impacting the UK economy. Because Britain remains a net oil importer, the sudden spike in energy costs has deepened inflation anxieties across domestic markets.

Simultaneously, currency traders are recalibrating their positions ahead of critical policy announcements from the Bank of England and the U.S. Federal Reserve. With the Fed signaling a likely rate hike to counter inflationary pressures, capital continues to flow toward the dollar, further compressing the pound's performance.