WTI price skyrockets amid escalating Israel-Palestine tensions
- WTI surged over 5%, trading at $90.87 per barrel, in response to escalating military actions between Israel and Palestine.
- Israel's ground offensive in the Gaza Strip triggers a risk-off market mood, boosting safe-haven assets and oil prices.
- Iran’s Oil Minister predicts crude prices could hit $100 per barrel due to the intensifying geopolitical situation in the Middle East.
West Texas Intermediate (WTI), the US crude oil benchmark, soars more than 5% on a risk-off impulse due to escalations of the conflict between Palestine and Israel, with the latter beginning its ground offensive in the Gaza Strip. Therefore, WT is trading at $90.87 per barrel after bouncing from daily lows of $86.32.
Geopolitical strains and supply concerns boost WTI above $90.00, stirred by potential production disruptions
Israel's announcement of ground raids sparked flows to safe-haven assets, mainly Gold and the US Dollar (USD). Oil remains bid on fears the escalation would hit supplies from nearby countries in the world’s central crude-producing region.
In the meantime, Iran’s Oil Minister Java Owji noted that crude prices are projected to reach $100 per barrel due to the ongoing geopolitical developments in the Middle East, as reported by Reuters.
Chances of the conflict are spreading after Ran’s linked group Hezbollah launched cross-border attacks on Israel. That could spur a reaction by the United States (US), which could reimpose sanctions on Iran’s exports, which would likely hit global Oil supplies.
Another reason behind the WTI jump was the US imposing sanctions on owners of Oil tankers carrying Russian crude priced above the $60 a barrel cap accorded by the Group of Seven.
Aside from this, the Organization of the Petroleum Exporting Countries (OPEC) kept its forecast for growth in global Oil demand, spurred by a resilient world economy so far this year and further demand gains in China.
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