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In the realm of global markets, oil prices surged in early Friday trading, poised for significant weekly gains against a backdrop of escalating tensions in the Middle East. The region’s geopolitical landscape has been tumultuous, with Israel rejecting a ceasefire proposal from the Palestinian Islamic Resistance Movement (Hamas), further fueling uncertainty.
As the clock struck 0119 GMT, Brent crude futures advanced by eight cents, marking a 0.1 percent increase to $81.71 per barrel. Meanwhile, US West Texas Intermediate crude futures saw a similar uptick, rising by 17 cents, or 0.2 percent, to $76.39 per barrel. The momentum follows a notable three percent surge in oil prices during the previous session.
The recent flare-up in tensions saw Israeli forces launching airstrikes on Rafah, a border city in the southern Gaza Strip, following Prime Minister Benjamin Netanyahu’s dismissal of the ceasefire proposal. Consequently, oil prices remained buoyant, with both benchmarks poised to register a robust 5.7 percent increase for the week.
In response to Israel’s military actions, American officials issued sharp criticism regarding civilian casualties in Gaza, further amplifying international scrutiny of the conflict. The situation escalated as Israel shifted its focus to Rafah, intensifying the gravity of the situation.
In a bid to quell hostilities, a delegation from Hamas convened in Cairo on Thursday to engage in talks with mediators from Egypt and Qatar. The discussions aimed to broker a ceasefire and alleviate mounting tensions in the region.
Despite the surge in oil prices driven by heightened geopolitical risks, oil production remained unaffected by the ongoing conflict. However, the continued volatility in the Middle East underscores the enduring influence of geopolitical dynamics on global oil markets.
As the weekend approaches, market observers will closely monitor developments in the Middle East for any signs of de-escalation or progress towards a ceasefire. Uncertainty prevails, and the impact of geopolitical tensions on oil prices remains a focal point for traders and investors alike.
