Oil was mixed in Asia today as West Asian tensions escalated after Israel launched a fresh attack in Gaza, while rising US crude stockpiles tempered the market sentiment, analysts said.
New York’s main contract, light sweet crude for delivery in December, fell eight cents to $86.24 a barrel while Brent North Sea crude for December delivery gained seven cents to $109.68.
News of the Israeli air strike in Gaza yesterday that killed a Hamas military chief “reignited” tensions in the oil-producing West Asia and are keeping crude prices on the boil, IG Markets said in a report.
The United Nations will meet in an emergency session later in the day to try to defuse tensions in the region after the killing of Ahmed Jaabari and his bodyguard.
In response to Jaabari’s death, Palestinian militants warned that the Jewish state had opened “the gates of hell”, while Egypt said it was recalling its ambassador to Israel in protest.
Israel however said this was only the start of an operation targeting militant groups in Gaza, which comes as it prepares for general elections in January.
Despite the tensions in the oil-rich West Asia, “US crude has remained flat... countered by rising US stockpiles”, the IG Markets report stated.
A weekly report late yesterday by the American Petroleum Institute showed crude stocks in the world’s largest oil consumer rising 1.3 million barrels last week, indicating weak demand.
This was less than analyst projections of a 1.9 million-barrel gain, but was not enough to reassure traders’ fears of slipping US energy demand.