Oil jumps above US$39 as Mideast conflict widens

Oil prices rose to above US$39 a barrel in Asia yesterday, jumping for a second trading day as a widening conflict between Israel and Gaza raised tensions in the oil-rich Middle East.
Light, sweet crude for February delivery rose US$1.37 to US$39.08 a barrel in electronic trading on the New York Mercantile Exchange by midday in Singapore. The contract on Friday rose US$2.36 to settle at US$37.71.
Israel expanded its deadliest-ever air offensive against Gaza's Hamas rulers Sunday and prepared for a possible ground invasion. Arab leaders protested the attacks and Syria broke off indirect peace talks with the Jewish state.
With the two-day death toll nearing 300, Hamas fired rockets deeper than ever into Israel.
Oil prices have fallen 73 percent since peaking at US$147.27 a barrel on July 11 as a credit crisis in the U.S. sparked a steep drop-off in consumer demand and corporate earnings. Analysts expect more dismal economic news from the fourth quarter over the next few weeks.
Pressure on prices
"More bad profit reports, jobs reports, housing results will put pressure on prices," Rigby said. "Once Obama comes in, that might start changing sentiment and generate more optimism."
Trading volumes have been low as many traders take off the week between Christmas and New Year's Day.
In other Nymex trading, gasoline futures rose US$0.0316 to US$0.88 a gallon. Heating oil gained US$0.033 to US$1.28 a gallon while natural gas for January delivery jumped US$0.163 to US$5.99 per 1,000 cubic feet.
In London, February Brent crude rose US$1.56 to US$39.93 a barrel on the ICE Futures exchange.

Updated : 2021-03-04 02:41 GMT+08:00