(London) Oil prices were up on Wednesday after a strike that left hundreds dead in a Gaza hospital, raising fears of a potentially regional escalation of the war between Israel and Hamas.
Around 6 a.m. (Eastern time) (12 p.m. in Paris), a barrel of Brent from the North Sea for delivery in December, listed in London, gained 3.27% to $92.84.
That of West Texas Intermediate (WTI), for delivery in November, listed in New York, gained 3.02% to $89.28.
“Brent oil prices are up again this Wednesday, reaching their highest level since the start of the crisis” between Israel and Hamas, notes Ricardo Evangelista, analyst at ActivTrades.
The strike “last night in a hospital in Gaza raised the stakes of the conflict” and increased the risk that “other countries in the region, such as Iran, find themselves involved,” he adds.
“This scenario would almost certainly affect global oil supply and could push the price of a barrel to levels above the hundred dollar mark,” continues Mr. Evangelista.
Countries in the region like Saudi Arabia are indeed among the main oil producing and exporting countries in the world.
American President Joe Biden, visiting Israel on Wednesday, supported the version of the Israeli authorities attributing the strike on the Gaza hospital to Palestinian fighters.
Hamas attributed it to Israel and Islamic Jihad described the Israeli state’s accusations as “lies”, while international condemnations are increasing.
Joe Biden was scheduled to attend a summit in Jordan with Jordanian King Abdullah II, Egyptian President Abdel Fattah al-Sissi and Palestinian Authority leader Mahmoud Abbas, but Amman canceled it after the hospital strike .
“This type of diplomatic turn still generates fears of an extension of the conflict and therefore jumps [les cours du] oil,” adds John Evans, of PVM Energy.
Investors are also awaiting the release of the U.S. Energy Information Administration’s (EIA) weekly U.S. commercial inventory status for the week ended October 13.
The federation of professionals in the sector, the American Petroleum Institute (API), estimated Tuesday that crude stocks had fallen by around 4.383 million barrels last week, and those of gasoline by 1.578 million barrels.
Oil also benefited from this drop in crude stocks estimated by the API, “much greater than the forecast”, indicated John Evans, analyst at PVM Energy.
However, API data are considered less reliable than those of the EIA. Analysts, for their part, are counting on a drop of 550,000 barrels in commercial crude reserves, and 100,000 barrels of gasoline, according to the median of a consensus compiled by Bloomberg.