Hamas Attacks Israel
October 9, 2023
Hamas, a Palestinian militant group, launched a surprise attach in southern Israel on Saturday. The energy markets opened higher on Sunday night and rallied. Prices for WTI crude oil, ULSD, and RBOB futures have all pulled back from the highs put in shortly after the Sunday night open.
The market and traders are waiting for more news from the Israeli/Palestinian conflict and other factors that drive energy prices. Early sentiment seems to indicate not much of a price reaction is expected considering the the fighting is happening in a non-production region. But the bigger picture is the fact that anytime there is unrest in the Middle East, the market worries about the ramifications and, in this case, it is that Iran has backed Hamas.
The market has seen increased barrels out of Iran in the last several months mainly due to the easing of US sanctions. Will the US start to crack down again and increase enforcement of the sanctions that are currently in place? Is Israel willing to take direct action against Iran? The market will be tuned in for any new developments that could impact oil. This situation is expected to increase overall market volatility.
Baker Hughes reported that oil rigs fell by four to a total of 497, their lowest since February 2022.