Following the attack by Hamas on Israel on October 7, traders initially priced in a to risk premium when oil markets opened. The International Energy Agency (IEA), known as the world’s leading energy regulator, has recently warned that the global energy market is likely to remain volatile as the war between Israel and Hamas persists. The IEA Warning on Energy Market According to a CNBC report, the IEA stated in its latest monthly oil market release that, while the conflict has not yet directly impacted the physical oil supply, the energy market remains on edge as the situation unfolds. The IEA noted a “sharp escalation in geopolitical risk” and emphasized the uncertainty surrounding the conflict’s development. Meanwhile, the IEA has been warning about tightly balanced oil
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Benjamin Godfrey considers the following as important: Commodities & Futures, Energy Costs, iea, Market News, News, opec, Story of the Day
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Following the attack by Hamas on Israel on October 7, traders initially priced in a $3 to $4 risk premium when oil markets opened.
The International Energy Agency (IEA), known as the world’s leading energy regulator, has recently warned that the global energy market is likely to remain volatile as the war between Israel and Hamas persists.
The IEA Warning on Energy Market
According to a CNBC report, the IEA stated in its latest monthly oil market release that, while the conflict has not yet directly impacted the physical oil supply, the energy market remains on edge as the situation unfolds. The IEA noted a “sharp escalation in geopolitical risk” and emphasized the uncertainty surrounding the conflict’s development.
Meanwhile, the IEA has been warning about tightly balanced oil markets for some time. This situation, coupled with the ongoing Middle East crisis, has raised concerns among policymakers and market observers. In such a delicate balance, any unexpected disruption in oil supply could have significant ramifications for global energy security.
However, the IEA stated that it is closely monitoring the global energy market and is prepared to act if necessary to ensure markets remain adequately supplied. In the event of a sudden oil supply shortage, the IEA’s response includes member countries releasing emergency stocks and potentially implementing demand restraint measures.
Toril Bosoni, the head of the oil markets division at the IEA, recently discussed the impact of the conflict on oil markets during an interview with CNBC’s “Street Signs Europe.” She emphasized that while the conflict has raised concerns, there has been no direct impact on oil supplies thus far.
Beyond the economic implications, the humanitarian aspects of the conflict cannot be ignored. Israel’s “complete siege” of the Gaza Strip, which aims to halt the supply of electricity, food, water, and fuel to the already blockaded population, raises serious humanitarian concerns.
Collaborative Efforts and Reassurance
Bosoni also addressed concerns about the potential weaponization of oil exports by OPEC kingpin Saudi Arabia or other oil-producing nations in support of Hamas.
She highlighted the cooperative stance of the OPEC+ alliance, stating:
“What we’re hearing from the OPEC+ alliance is that they stand ready to do what they can to stabilize the market, and this is really reassuring.”
The reassurance from OPEC+ underscores the importance of global cooperation in maintaining energy market stability during times of crisis. Such collaboration is vital in preventing supply disruptions that could have far-reaching economic consequences.
Following the surprise attack by Hamas on Israel on October 7, traders initially priced in a $3 to $4 risk premium when oil markets opened. However, prices have since stabilized, reflecting the resilience of the market. Crude futures, including the international benchmark Brent crude and US West Texas Intermediate crude, have continued trading, with Brent crude futures showing a 0.9% increase at $86.59 per barrel, and US WTI crude futures rising 0.7% to $84.06 per barrel.
The recent optimism comes shortly after the 10-year and 2-year Treasury yields fell to 4.6571%, and 4.9843% respectively on Tuesday morning.
Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.