World markets are trembling against new war drums. outbreak of violence Middle East One more factor added Conflict in UkraineAdds new tension to oil prices. Although Israel and Palestine are not regions of obvious importance in oil production, the instability in the Middle East is a factor that may affect the barrel prices of Brent, which is Europe’s reference, and cause fluctuations in the stock markets. According to analysts. Assets that are considered safe havens, such as the dollar and gold.
Crude oil prices made a small recovery in the early hours of the day and are currently trading around $90. They remained at $85 a barrel at market close on Friday. Despite this, experts consulted by the Reuters agency predict that the global impact of Hamas’ attack on Israel by Palestinian militias will be limited on the markets. Analysts are aware that a certain increase in the risk premium is expected until operators are convinced that the conflict has not spread to other countries in the region and oil and gas supplies are functioning normally in the Middle East.
Middle East stock markets indeed felt this shock and reflected it on Sunday. Tel-Aviv’s benchmark index TA-35 fell to 6.47%, the biggest drop in the last three years. While Riyadh Tadawul index lost value by 1.57%, there were decreases in Qatar and Kuwait markets. The EGX30 in Cairo also lost 2.6 percent following a shooting that left an Egyptian police officer dead and two Israelis.
Iran’s role
Iran is indeed one of the major oil producers in the Middle East region and a supporter of Hamas. The Iranian state supports the actions of Palestinian militants as well as Hezbollah in Lebanon. If the conflict affects Iran in some way, the repercussions of the conflict on the markets may be felt more strongly. “Geopolitical crises in the Middle East often cause oil prices to rise and stock prices to fall.”According to Reuters news from Yardeni Research firm. “Everything will depend largely on whether the crisis will remain a short-term shock or develop into something deeper, such as a larger-scale conflict between Israel and Iran.”
“Leaving the human tragedy aside, the consequences of this increase in violence should not affect financial markets,” iCapital’s Guillermo Santos said in statements reported by the Bloomberg agency. However, if the tensions spread to other giants in the region, such as Saudi Arabia, which has a heavy weight in the oil markets,A negative impact on crude oil prices may put upward pressure on inflation in Western economies. This will force central banks to continue to implement restrictive monetary policy with high interest rates for a longer period of time.
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Saudi Arabia has been trying to establish diplomatic relations with Israel in recent months in order to increase commercial exchanges and calm the region.. This is a step taken by other countries in the Persian Gulf, such as the Emirates and Bahrain, by signing the Abraham Accords in 2020. Other Arab countries, such as Sudan and Morocco, have taken similar steps to recognize the agreement. State of Israel.. The revival of the Palestinian-Israeli conflict indicates the escalation of the already difficult relations between Arab countries and Israel in the Middle East.
“It is possible that Hamas carried out an action” A very cruel, cruel and disgusting attack “It is precisely to provoke such a strong Israeli reaction that it makes it impossible for any Arab leader to dare to be photographed next to the Israeli ambassador or minister or to directly receive Prime Minister Benjamin Netanyahu,” the security and defense analyst says. Jesus Manuel Perez Triana.