BEIJING (Reuters) – Oil prices rose on Tuesday morning after Israel attacked Rafah in Gaza, while negotiations for a ceasefire with Hamas remained unresolved.
Brent crude futures rose 46 cents, or 0.55%, to $83.79 per barrel by 0010 GMT, while West Texas Intermediate (WTI) crude futures rose 46 cents, or 0.59%, to US$78.94 a barrel.
Prices rose on Monday, partially reversing last week’s declines, in which both contracts posted their biggest weekly losses in three months, with a focus on weak US employment data and the possible timing of a rate cut. interest rate from the Federal Reserve.
Palestinian militant group Hamas on Monday agreed to a Gaza ceasefire proposal presented by mediators, but Israel said the terms did not meet its demands and pressed ahead with strikes in Rafah as it planned to continue talks on a deal.
Israeli forces attacked Rafah, on the southern tip of Gaza, by air and land and ordered residents to abandon parts of the city, which has been a refuge for more than a million displaced Palestinians.
The lack of agreement between the parties to the seven-month conflict has supported prices as investors fear the regional escalation of the war could disrupt oil supplies in the Middle East.
Riyadh’s decision to increase official selling prices for its crude sold to Asia, Northwest Europe and the Mediterranean in June also supported prices, signaling expectations of strong demand this summer.
The world’s biggest exporter raised the price of its flagship Arab Light crude oil for Asia to $2.90 a barrel above the Oman/Dubai average in June, the highest since January and at the upper end of traders’ expectations in a Reuters poll.
(Reporting by Andrew Hayley; Editing by Sonali Paul)
