2023-10-16 07:04:58
Oil declines as investors evaluate the repercussions of the war between Israel and Hamas
Oil prices fell on Monday, with Friday’s rise relatively subsiding, as investors awaited the repercussions of the conflict between Israel and the Islamic Resistance Movement (Hamas) on other countries, which might push prices up and deal a new blow to the global economy.
Brent crude futures fell 34 cents, or 0.4%, to $90.55 per barrel, and West Texas Intermediate crude futures fell 41 cents, or 0.5%, to $87.28 per barrel by 00.48 GMT.
The two crude oil prices rose by regarding 6% on Friday, the largest daily rise in percentage terms since April, as investors took into account the expanding scope of the conflict in the Middle East.
During the week, Brent achieved record gains and rose 7.5%, while West Texas Intermediate crude increased 5.9%.
“Investors are trying to determine the impact of the conflict while the large-scale ground offensive has not begun following the 24-hour deadline that Israel initially granted to residents of the northern half of Gaza,” said Hiroyuki Kikukawa, president of NS Trading, a unit of Nissan Securities. “They should flee to the south.”
He added, “The impact that might include oil-producing countries has been taken into account to some extent, but if an actual land invasion occurred and had an impact on oil supplies, prices might easily exceed $100 per barrel.”
The conflict in the Middle East has had little impact on global oil and gas supplies, and Israel is not a major producer.
But the war between Hamas and Israel poses one of the most important geopolitical risks to oil markets since the Russian invasion of Ukraine last year, amid concerns regarding any potential escalation involving Iran.
Market participants are assessing what a broader conflict might mean for supplies from countries in the world’s largest oil-producing region, including Saudi Arabia, Iran and the UAE.
(Archyde.com)
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