Ana sayfa » Oil prices rise on possibility of worsening Middle East crisis

Oil prices rise on possibility of worsening Middle East crisis

The bullish trend in oil continues as the geopolitical situation in the Middle East remains challenging


Oil prices rose in Asian trading on Thursday after gaining a dollar a barrel in the previous session, on the prospect of a further worsening of the Middle East crisis involving Iran.

Brent crude oil futures were up 5 cents at $90.53 a barrel at 06:32 GMT, while WTI crude oil futures were up 4 cents at $86.25 a barrel.

Earlier this week, Israel and Hamas began a new round of negotiations in the more than six-month-old Gaza war, but these talks failed to produce any agreement.

Both benchmarks rose more than 1 percent in the previous session after the Hamas leader’s three sons were killed in an Israeli airstrike in Gaza, raising concerns that ceasefire talks between the two sides could stall.

Prices remain sensitive to geopolitical developments in the Middle East; market participants are pricing in the risks of supply disruptions if tensions continue for longer.

Risk-off sentiment is gaining importance as markets reanalyze interest rate expectations for a possible cut in June or keeping rates higher for longer until September.

Higher rates for longer periods of time could reduce economic growth and suppress oil demand.

Federal Reserve minutes showed officials are concerned that progress in inflation may have stalled and a longer period of tight monetary policy may be needed to rein in inflation in the world’s largest economy.

Investors who had previously expected a rate cut in June now view September as a more likely time for the easing cycle to begin, following stronger-than-forecast readings on consumer inflation for the third consecutive month.

It is also possible that the upward trend in oil may continue as the geopolitical situation in the Middle East remains challenging.

The region is on alert for possible Iranian retaliation following Israel’s suspected airstrike on Iran’s Syrian embassy at the beginning of the month.

In a statement, the US State Department said that Antony Blinken told Israeli Defense Minister Yoav Gallant that the US would stand by Israel against any threat from Iran.

The market is increasingly concerned that the Israel-Hamas war could escalate in the Middle East, putting oil supplies at risk.

Oil traders will also be awaiting the monthly oil market report from the Organization of the Petroleum Exporting Countries (OPEC) on Thursday and the International Energy Agency’s oil market report on Friday.