Oil Rises After Falling as Israel Seen Holding Off Gaza Invasion
Oil edged higher after dropping the most since Hamas’ attack on Israel as Tel Aviv was seen holding off on an invasion of Gaza amid hostage negotiations, containing the conflict for the time being.
Global benchmark Brent rose above $90 a barrel after tumbling by 2.5% on Monday, while West Texas Intermediate traded near $86. There are growing calls within Israel to rethink the scope of a ground invasion amid fear of retaliation by Hezbollah militants from Lebanon, the fate of some 200 hostages in Gaza and the risk of Israeli military casualties.
The lack of any immediate disruptions in the Middle East, the source of about of a third of the world’s crude, has seen some of the war-risk premium being eroded. Brent is still 7% higher than before the Oct. 7 attack, however, and the main triggers for a further surge in prices include Washington ramping up compliance checks on sanctioned Iranian oil and Tehran disrupting key shipping routes.
The US said it will deploy more military forces to the Middle East in an effort to deter groups such as Hezbollah from trying to expand the war, while China shifted its stance by acknowledging Israel has the right to self defense against Hamas.
Brent for December settlement climbed 0.7% to $90.42 a barrel at 10:19 a.m. in Singapore. WTI for December delivery rose 0.6% to $86.04 a barrel.
Source : Bloomberg
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