On Monday, oil prices rallied as reports highlighted that an Iran strike would likely occur in the upcoming days.
In the Asian afternoon session, Brent futures for October delivery surged by 0.56% to $80.11 per barrel. West Texas Intermediate (WTI) futures for September contracts increased by 0.82% to $77.47 a barrel.
Some economic data was also added to support the commodity as investors bet that concerns of a US recession were overblown. A further crucial economic report is in focus this week.
According to reports, oil prices are holding gains as the US Federal Reserve signals interest rate reduction.
Meanwhile, reports indicated that Israeli intelligence anticipates that Iran will likely strike Israel within days. The incursion is possibly to be in retaliation for the fatality of Hamas leader Ismail Haniyeh in Tehran in July.
Furthermore, Israel continued its offensive in Gaza over the weekend with a series of strikes, signaling little chance of de-escalation in the ongoing conflict.
The prolonged conflict also led traders to increase the risk premium on oil prices due to rising concerns about potential supply disruptions from the resource-rich Middle East.
Mideast Tension, Economic Data Success Supports Oil Prices
According to reports, oil has maintained last week’s gains, fueled by Mideast geopolitical tensions and economic data success.
Meanwhile, Iran has boldly opened new crude export destinations like Bangladesh and Oman. Reports show that small portions of Iranian oil were shipped to these countries early this year.
Furthermore, the attack on Gaza escalated last Saturday with an airstrike on a school compound, which led to the slaughter of at least 90 individuals.
On the other hand, Hamas cast skepticism over its participation in the ceasefire talks on Sunday.
Meanwhile, inflation readings are focused this week on several significant economies, especially the US.
In addition to economic readings, the Organization of Petroleum Exporting Countries and the International Energy Agency’s monthly reports are also due this week.
