By Adedapo Adesanya
Oil prices went up on Wednesday after three sons of a Hamas leader were killed in an Israeli airstrike in the Gaza Strip, feeding worries that ceasefire talks might stall.
Brent crude futures grew by $1.06 or 1.2 per cent to $90.48 per barrel while the US West Texas Intermediate (WTI) crude futures soared by 98 cents or 1.2 per cent to $86.21 per barrel.
The Israeli military confirmed carrying out the attack, describing the three sons as operatives in the Hamas armed wing.
On Tuesday, Hamas said it was studying an Israeli ceasefire proposal in the more than six-month-old Gaza war which it said met none of the Palestinian demands.
In the seventh month of a war in which Israel’s air and ground offensive has devastated Gaza, Hamas wants an end to Israeli military operations and a withdrawal from the enclave, and permission for displaced Palestinians to return home.
A continuing conflict could drag in other countries, particularly Hamas-backer, Iran, the third-largest producer in the Organization of the Petroleum Exporting Countries (OPEC).
Prices remain highly volatile, according to analysts and, as one of them pointed out to Reuters, it would take just one piece of news to restart the rally.
Supply issues also supported prices following Mexico’s decision to curb crude exports to supply domestic refineries and led to record low US imports of Mexican crude in early April.
Pressure came as the Energy Information Administration reported an estimated inventory build of 5.8 million barrels for the week to April 5. The authority also reported builds in fuel inventories.
This compared with a build of 3.2 million barrels for the previous week, which also saw substantial drawdowns in gasoline and middle distillate inventories.
A day before the EIA report, the American Petroleum Institute (API) estimated a build of over 3 million barrels in crude oil stocks, along with a moderate draw in gasoline (known as petrol) and a minor build in middle distillates.
The market will be awaiting OPEC’s monthly oil market report which will be published Thursday, April 11 and the International Energy Agency’s oil market report will be published Friday, April 12.
Modupe Gbadeyanka