Oil and gas prices rise amid rising global tensions | Business News

British wholesale gas prices have risen to their highest level in more than eight months – risking a future rise in energy bills – amid fears about escalating tensions in the war between Ukraine and Russia.

Prices surpassed 100 cents per thermal on Monday, the highest level since December 2023, according to data from the London Stock Exchange Group.

This follows Kiev’s decision to launch an invasion of Russia’s Kursk region last week.

Since then, Ukrainian media outlets have broadcast unverified videos that appear to show the country’s soldiers in control of a gas measuring facility in the region’s city of Sudzha – a key location for Russian natural gas exports to Europe through Ukraine.

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Supply issues have also contributed to rising gas prices, including a recent unplanned outage at the crucial Bacton Seal terminal on the Norfolk coast. The St Fergus Mobil gas terminal in Aberdeenshire will also soon close for more than five weeks.

Meanwhile, oil prices also rose as fears grew about the deteriorating situation in the Middle East – raising the prospect of more expensive gasoline if the increases continue.

The price of benchmark Brent crude rose to more than $80 (£63) a barrel on Monday, the highest since July 31.

Speculation has increased that Iran could retaliate against Israel after the assassination of a senior Hamas member in Tehran last month, while the US ordered the deployment of a guided missile submarine to the oil-producing region.

Tensions were further fueled by the Israeli crisis assassination of Hezbollah’s top military commanderFuad Shukr in the Lebanese capital Beirut last month.

An Israeli airstrike on a school turned shelter in Gaza City, which Palestinian health officials say they killed 80 peoplealso raised doubts about the prospects for an imminent ceasefire in the Israel-Hamas War.

The oil price rise also comes after last week’s lows as fears about a U.S. recession caused a sell-off in the market.

However, new data showing a drop in U.S. jobless claims eased fears of a recession later in the week.

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Markets analyst Tony Sycamore of trading platform IG UK said: “Support [on oil prices] comes from better-than-expected US data from last week, which eased fears of a US recession.

“There is also great anxiety about when Iran might seek to avenge Israel’s assassination of senior Hamas and Hezbollah leaders. [It] It seems like a question of when, not if.”

Warren Patterson of Dutch financial institution ING added: “The market is still awaiting Iran’s response.”

However, despite fears over gas supplies, Russia’s Gazprom said it would send 39.6 million cubic meters (mcm) of gas to Europe on Monday, compared with 39.3 million cubic meters (mcm ) on Sunday.

Christoph Halser, an analyst at Rystad Energy, said the impact of any escalation in the war could also be limited as Europe has reduced its dependence on Russian gas in recent years.