The oil market is reacting to the death of Hamas political leader Ismail Haniyeh, who was killed in Tehran on Wednesday morning. The New York Stock Exchange is seeing strong gains. The leader's death has fueled tensions in the Middle East, a region that accounts for about a third of global oil production, brokers say.
A barrel of West Texas Intermediate crude for delivery on IX is trading at $76.19 on the NYMEX in New York, up 1.95 percent.
Brent on ICE on X is trading at $79.88 per barrel, up 1.59%.
Death of Hamas leader
Iran's Islamic Revolutionary Guard Corps said in a statement on Wednesday that Hamas leader Ismail Haniyeh was assassinated in the Iranian capital, Tehran.
Ismail HaniyehPAP/EPA
Hamas said Haniyeh was killed in a “Zionist” airstrike on his residence in Tehran after he attended the inauguration of Iran's new president.
This happened after an earlier attack. Israel on Beirut, in which Hezbollah's main military commander, Fuad Shukr, was killed.
“We conducted a targeted airstrike on the Lebanese capital, Beirut, targeting the Hezbollah commander responsible for Saturday's deadly attack on the Golan Heights and other attacks on Israel,” the Israeli military said Tuesday.
Rising tensions in the Middle East could threaten ongoing ceasefire talks in the conflict between Israel and Hamas.
“This attack obviously dashes the hopes in the markets for a ceasefire,” said Priyanka Sachdeva, senior market analyst at brokerage Phillip Nova Pte in Singapore.
“Since the attack (on Haniyeh) happened in Tehran, it is likely that it could trigger a wider conflict and we may see the involvement of other countries,” he warned.
The Impact of Political Tensions on the Oil Market
Oil traders are assessing the risks of the conflict escalating and wondering whether it could lead to more attacks on ships passing through the Red Sea or affect oil production and exports, particularly from Iran.
Meanwhile in USA Oil reserves continue to decline, according to an industry report by the American Petroleum Institute (API).
API reported that U.S. crude inventories fell by 4.5 million barrels last week, marking the longest streak of declines in crude inventories since January 2022.
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