Oil prices rise 1% as Middle East attacks heighten supply concerns

OIL prices rose more than 1 per cent on Thursday (Oct 24), reversing some of the previous session’s losses, as the Middle East conflict and reports of North Korean troops ready to help Russia in Ukraine kept traders on edge ahead of the US presidential election.

Brent crude futures were up US$1.26, or 1.7 per cent, to US$76.22 a barrel as of 0905 GMT. US West Texas Intermediate crude futures climbed US$1.26, or 1.8 per cent, to US$72.03.

Oil prices have gained about 4 per cent this week after shedding more than 7 per cent last week on concerns of oversupply and weak demand and a perceived calming of Middle East tensions.

“The opposing forces of economic anxiety, loose oil balance and potential war-related supply disruptions will ensure that no clear oil price direction emerges in the immediate future whilst the risk remains skewed to the downside in the medium term,” said Tamas Varga of oil broker PVM.

On Wednesday, the US said for the first time it had seen evidence North Korea has sent 3,000 troops to Russia for possible deployment in Ukraine, a move that could mark a significant escalation in Russia’s war against its neighbour.

In the Middle East, an exchange of heavy fire between Israel and Hezbollah heightened supply concerns, as Israeli strikes also hit the Syrian capital Damascus early on Thursday, Syrian state media reported.

That escalation comes as Washington makes a push for peace between Israel and Iran-backed groups Hezbollah and Hamas before the Nov five US presidential election that could alter both its Middle East and oil policy.

“Trump is leading over (Kamala) Harris based on current data from betting markets and Trump has proposed making the US a major oil supplier,” said OANDA senior market analyst Kelvin Wong, adding that could depress prices.

While betting markets put Trump ahead, other polls show the result is currently too close to call. REUTERS