Oil prices fell further after a 1.6% drop amid Israel-Hamas deal
Kyiv • UNN
Brent crude futures fell 7 cents to $65.15 a barrel, while U.S. WTI crude fell 2 cents to $61.49. This happened after Israel and Hamas agreed on the first phase of a plan to end the war in Gaza.
Oil prices fell slightly on Friday after falling 1.6% in the previous session, as the risk premium in the market decreased after Israel and Hamas agreed on the first phase of a plan to end the war in Gaza, UNN reports with reference to Reuters.
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Brent crude futures fell 7 cents to $65.15 a barrel by 03:38 GMT (06:38 Kyiv time). U.S. West Texas Intermediate crude fell 2 cents to $61.49.
Israel and the Palestinian militant group Hamas signed a ceasefire agreement on Thursday as part of the first phase of U.S. President Donald Trump's program to end the war in the Gaza Strip.
Israel and Hamas agree on terms to end two-year war - Media09.10.25, 14:03 • 2964 views
Under the agreement, which the Israeli government ratified on Friday, hostilities will cease, Israel will partially withdraw its troops from the Gaza Strip, and Hamas will release all hostages captured in the attack that sparked the war, in exchange for hundreds of prisoners held by Israel.
On a weekly basis, both oil benchmarks rose by approximately 1% in price after a sharp decline last week.
On Wednesday, prices rose by approximately 1%, reaching a weekly high, due to a halt in progress on a peace agreement for Russia's war against Ukraine, a sign that sanctions against Russia, the world's second-largest oil exporter, could continue, the publication writes.
The ceasefire agreement in the Gaza Strip was an important step towards ending the two-year war, which increased the risk of oil supply disruptions, ANZ analyst Daniel Hynes said in a note on Friday.
"This (agreement) has shifted the focus back to the upcoming oil surplus, as OPEC continues to reverse production cuts," Hynes said.
A smaller-than-expected increase in production in November, agreed upon by the Organization of the Petroleum Exporting Countries and its allies (OPEC+) on Sunday, somewhat eased fears of an oversupply.
"Market expectations of a sharp increase in crude oil supply did not lead to a significant drop in prices," BMI analysts noted in their note on Friday.
"The latest production increase turned out to be lower than previously expected, which led to a small increase in prices for the week," they noted.
Investors are also concerned that a prolonged U.S. government shutdown could weaken the American economy and reduce oil demand in the country, which is the world's largest consumer.