(London) Oil prices regained momentum on Friday, driven by the geopolitical risk caused by the war between Israel and Hamas, when European gas rose to new heights since February.
Around 6:15 a.m. (Eastern time), a barrel of North Sea Brent, for delivery in December, gained 3.67% to $89.16.
Its American equivalent, a barrel of West Texas Intermediate (WTI), for delivery in November, rose 3.80% to $86.06.
On the seventh day of the war between Israel and Hamas, fears that the conflict would spread to neighboring countries have resumed, pushing up the prices of the two crude oil benchmarks.
“The flammable environment in the Middle East could easily lead to considerable supply shortages,” says Tamas Varga, analyst at PVM Energy.
Iran is at the center of attention for its unreserved support of Hamas. If Tehran has long supported the Palestinian Islamist movement, Iranian leaders nevertheless claim not to be involved in the attack it launched on Saturday against Israel, sworn enemy of the Islamic Republic.
At the same time, the United States announced on Thursday the first sanctions, targeting two companies, for non-compliance with the ceiling on the price of Russian oil set at $60 per barrel, almost a year after the imposition of this mechanism by several Western countries.
The US Treasury “called these measures a new phase in the implementation of a policy aimed at limiting the flow of money to Russia to finance its war in Ukraine,” comment DNB analysts.
“The application of tougher sanctions by the United States against Russia and Iran could potentially tighten the balance of the oil market,” they recall.
On the European natural gas side, the Dutch TTF futures contract, considered the European benchmark, remained almost stable, moving at 53.42 euros per megawatt hour (MWh) shortly after touching 56.10 euros per MWh, its highest price since at the beginning of February.
“In addition to the geopolitical uncertainty linked to the outbreak of war in the Middle East”, the damage to a gas pipeline in the Baltic Sea and “the alleged involvement of Russia raise fears that similar events will occur on other more critical gas pipelines in Europe,” comment Energi Danmark analysts.
Finnish President Sauli Niinistö announced Tuesday that this leak on the gas pipeline linking Finland to Estonia in the Baltic Sea, which caused the interruption of its operation on Sunday, had probably “resulted from an external activity” without further details .
Finnish intelligence services estimated on Thursday that the threat of Russian operations on Finnish infrastructure had increased since its membership of NATO.