Why Oil Traders Shouldn’t Discard Israel-Hamas War Risk

The rise in the benchmark Brent oil price from just over US$72 per barrel (pb) to above US$80pb in a week highlights that the risk premium attached to the Israel-Hamas war is still very much in play in the global oil markets. Although other factors played a part in the oil price rise, a significant part of the increase was due to the rising danger posed to tankers moving oil from the Middle East to Europe via the Red Sea. This has long been the shortest and generally cheapest method to move oil via ships from east to west. However, several vessels…