Oil prices continued to surge on Friday as the conflict between Israel and Hamas continued to rage on. Prices were on course to a second consecutive weekly gain.
Global benchmark Brent rose above $93 per barrel, with JPMorgan Chase & Co. analysts including Natasha Kaneva explaining in a report that geopolitical tensions are at the core of price rises. Kaneva claimed that prices are $7 higher than what they would be if the Middle East conflict was not ongoing. “Underlying fundamentals are playing second fiddle to the tragic events in Israel and Gaza,” said Tamas Varga, an analyst at brokerage PVM Oil Associates Ltd, thus agreeing with Kaneva’s sentiment.
Despite this pressure, Kaneva explained that any further escalation in the conflict may not have much of an upward push on prices seeing as this pressure has already been applied. As the conflict rages on, the US Energy Department revealed its plan to buy as many as 6 million barrels for the Strategic Petroleum Reserve in an effort to replenish its stockpile.