Oil Futures Surge on Concern Israel-Hamas Conflict to Escalate

Oil prices surged after the conflict between Israel and Hamas intensified, and traders are watching for spillover effects on oil supply in the region. Futures for Brent crude, the global benchmark, rose about 4% to $87.97 a barrel, and West Texas Intermediate crude futures climbed 4.3% to $86.36 a barrel on Monday in Asia.

The moves were a knee-jerk response from the market, said Kelvin Yew, a senior oil trader at the commodity-trading firm Ocean Leonid Investments. “There is very little oil production in that region, but the market is pricing in the possibility of an escalation,” Yew said. Iranian security officials helped plan Hamas’s attack on Israel, The Wall Street Journal has reported. That support has led the market to price in contagion risks, including the possibility of legislation being enacted in the U.S. to stop lifting sanctions on Iran, Yew added.