ISLAMABAD: Oil prices jumped around 4 percent on Monday amid continued fighting between Hamas and Israel that began a couple of days back. As of 1255 hours GMT, Brent, the international benchmark for two-thirds of the world’s oil, gained $3.20 (+3.78 percent) to reach $87.78 a barrel. The West Texas Intermediate (WTI), the main oil benchmark for North America, went up by $3.27 (+3.95 percent) to $86.06 a barrel. However, the price of Russian Sokol decreased by $1.53 (-1.95 percent) to $76.86. Arab Light prices witnessed a decrease of $1.36 (-1.53 percent) to reach $87.32 a barrel. On the other hand, the price for Opec Basket decreased to $88.51 with a decrease of $3.84 (-4.16 percent). TLTP
The OPEC Reference Basket of Crudes (ORB) is made up of Saharan Blend, Girassol, Djeno, Zafiro, Rabi Light, Iran Heavy, Basra Light, Kuwait Export, Es Sider, Bonny Light, Arab Light, Murban and Merey.
The price surge follows the biggest attack on Israel in years, after in the early hours of Saturday Hamas fighters entered the country by land, sea, and even air, and attacked Israeli towns. Israel retaliated with a series of air strikes on Gaza. Israeli Prime Minister Benjamin Netanyahu has declared war on Hamas, vowing a “mighty vengeance” on the group. Oil prices were quick to react to the deterioration in Middle Eastern security and will likely stay vulnerable to more wild swings as the situation develops.
Earlier last week, oil futures posted their worst weekly loss in the last seven months amid demand concerns and a stronger US dollar. Brent ended the third straight week lower by 8.26 percent, while WTI registered a weekly decline of 8.81 percent.
Last week, the Opec+ group of crude oil-producing states decided to stick to its current output policy and said it was closely assessing the market to take additional measures at “any time”. Meanwhile, Saudi Arabia and Russia have reaffirmed their combined supply cut of 1.3 million bpd to the end of the year.
The group has enforced total production curbs of 3.66 million bpd or about 3.7 per cent of global demand. This includes a reduction of 2 million bpd agreed on last year and voluntary cuts of 1.66 million bpd, announced in April and extended to December 2024.
