Topline
Global oil prices surged early on Monday, as the conflict between Israel and Hamas—which has resulted in at least 1,100 deaths so far—continued to escalate.
File Photo: Analysts believe the output of crude oil is unlikely to be impacted by the conflict.
Key Facts
The global benchmark Brent crude futures rose nearly 5% early Monday, before settling at $87.20 per barrel—up more than 3.1% from Friday.
The domestic West Texas Intermediate futures climbed past $86 per barrel, before settling at $85.7—more than 3.5% up since Friday.
Analysts cited by several outlets noted that the sharp spike in prices is likely a “knee-jerk” response to the conflict, as it is expected to have little overall impact on supplies as long as it does not escalate.
Gas Buddy’s Patrick De Haan noted that reports of Iran’s involvement potentially raise the stakes and lead to “more significant impacts on the price of oil,” but he insisted he believes there is more room for prices at the pump to continue to drop.
Key Background
On Saturday, the militant group Hamas launched the deadliest attack against Israel in decades as hundreds of its fighters entered Israel from the Gaza Strip while rockets were fired into Israeli cities. The fierce attacks appear to have caught the Israeli leadership by surprise with the country’s Prime Minister warning of a “long and difficult war.” Over the weekend, residents of Gaza have faced airstrikes by Israel. The overall death toll from the conflict has crossed 1,100 including at least 700 Israelis and 413 Palestinians. The Hamas fighters have also taken “scores” of hostages—including American citizens.
What To Watch For
According to the Wall Street Journal, Hamas’ attack on Israel may have been backed and approved by Iranian security forces. Proof of Iranian involvement in the attack could further escalate tensions in the region which could have a ripple effect on energy prices already impacted by Russia’s invasion of Ukraine. Iranian involvement in the conflict could lead to disruptions in the Strait of Hormuz—a key choke point in the global oil trade.
Section Title
Americans Taken Hostage In Hamas Attack On Israel—As Death Toll Passes 1,000 (Forbes)
At Least 260 Killed At Israeli Music Festival In Hamas Attack—Attendees Describe ‘Horror Movie’ (Forbes)
Source: https://www.forbes.com/sites/siladityaray/2023/10/09/global-crude-oil-prices-surge-amid-israel-hamas-conflict/