The price of Kuwaiti crude oil rose by $1.42 to reach $91.55 per barrel on Tuesday, Kuwait Petroleum Corporation said on Wednesday.
The jump in prices is widely seen as a direct impact of the dramatic situation involving Israel and Hamas, as this weekend’s attacks are said to be a geopolitical game changer.
The price of Kuwait crude rose though in international markets, forward transactions of the Brent crude oil edged down by 50 cents settling at $87.65 pb while those of the West Texas Intermediate lost 41 cents to reach $85.97 a barrel.
Industry analysts, however, expect crude prices to see a rise in the coming days as war premiums returned to the oil market following the conflict, raising concerns about stability in the Middle East.
“The first buying response [since Monday] has been driven by traders adding a geopolitical risk premium back in the price, though, as of now, there is no clear impact on supply,” said Ole Hansen, Head of Commodity Strategy at Saxo Bank.
Hansen said the premium could push up prices amid rise in fresh demand following last week’s strong correction which drove a significant amount of long liquidation, especially in Brent, the global benchmark.
The market’s foremost concern revolves around potential disruptions in supplies from regions like Iran, a report by Saxo Bank said.
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