Supply concerns amid Israel-Hamas war sends Brent back above $90/bbl

The front-month ICE Brent contract has gained $2.16/bbl on the day from Friday, to trade at $90.45/bbl at 09.00 GMT.

PHOTO: Getty Images

Upward pressure:

Surge in Brent futures indicates that the global oil market is still concerned about a potential disruption in supplies due to the ongoing conflict between Israel and Hamas militants.

Should the Israel-Hamas war escalate further, involvement from other nations in the Middle East could result in oil supply disruptions in an increasingly tight market. This could push Brent’s price further up.

“Energy traders continue to pay close attention to the Israel-Hamas war,” said OANDA’s senior market analyst Edward Moya. “Crude prices are surging as the oil market will remain very tight given escalating geopolitical risks could threaten supplies,” he further added.

Downward pressure:

Despite fears of escalating geopolitical tensions in the Middle East, there hasn't been any immediate impact on oil supplies in the region. “Despite recent developments in the oil market, speculators remain reluctant to jump into the market,” said analysts from ING Bank.

Iran’s total oil output in September increased by 15,000 b/d from the previous month to 3.06 million b/d, the Organization of the Petroleum Exporting Countries (OPEC) said in its monthly oil market report. The country produced 3.04 million b/d of crude in August.

By Aparupa Mazumder

Please get in touch with comments or additional info to news@engine.online