Oil prices surged today after US and UK forces launched strikes against Iran-backed Houthi rebels in Yemen following attacks on ships in the Red Sea, fuelling worries about a wider conflict in the crude-rich region, AFP reports.

The move weighed on sentiment among investors, though stocks were mixed after data showing US inflation rose more than expected last month further dented hopes for an early interest rate cut by the Federal Reserve.

News of the US-UK strikes, which President Joe Biden said also had support from Australia, Bahrain, Canada and the Netherlands, sent oil prices up more than two per cent Friday, with analysts saying WTI could pass $75 and Brent could top $80.

The jump in prices sparked concerns about a fresh spike in inflation that could complicate central bank pivots to a more dovish monetary policy this year, reviving worries about the economy.

“If oil were to substantially increase… that would jeopardise… this soft landing scenario that is quite likely for the year,” Andrew Slimmon, of Morgan Stanley Investment Management, told Bloomberg Television.