Oil prices surge following Hamas attack on Israel

Petrol station in Saudi Arabia
Petrol station in Saudi Arabia Copyright FAYEZ NURELDINE/AFP
By Euronews
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The sudden aggravation of the conflict in the Middle East is fuelling oil supply disruptions fears.


Concerns over ongoing violence impacting neighbouring countries saw Brent crude rise by about 4% over the weekend, stopping short of climbing to $89 on Monday morning.

The tendency remained unchanged on Tuesday.

Hamas's surprise assault on Israel on Saturday was the biggest escalation between the two sides for decades.

As usual when a war breaks out, the markets reacted instantly.

International relations play an important part in this, given each country’s support for either the Israeli or Palestinian side, with some trying to navigate on a more neutral ground.

Israel is a small oil producer, and although its production coming to a halt would impact the market, it wouldn’t greatly disturb it.

On the other hand, Iran’s oil production would. The Wall Street Journal reports that Iranian authorities helped plan the attacks perpetrated by Hamas.

Earlier in October, Iranian Supreme Leader Ali Khamenei warned against the normalisation of the relations with Israel, saying that any Muslim country doing so was “betting on a losing horse.”

A deal between Israel and Saudi Arabia was in the works, with the United States overseeing the talks.

The international community could decide to sanction Iran for its role in the recent escalation of the conflict, and its consequences on the region’s stability, further rising oil prices.

A potential expansion of violence to other countries would also negatively impact the market.

The business world’s eyes will be turned towards the Middle East this week, as stakeholders attempt to deduce the longer-term scenarios that will come out of the conflict.

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