Oil is trading with a strong rise this Monday, August 26, after the Sunday’s Israeli attack on Lebanon and Hezbollah’s responseBrent exceeds US$80 dollars per barrel (+2.7%), and WTI is above US$76 (+2.75%).
The Israeli army launched yesterday a “preemptive strike” with about 100 aircraftopening fire on “thousands of rocket launchers” in 40 areas of Lebanonmostly in the south of the country.
“This morning we detected Hezbollah’s preparations to attack Israel. Together with the Minister of Defense and the Chief of Staff, we ordered the Israel Defense Forces (IDF) to initiate action to eliminate the threat,” said Israeli Prime Minister Benjamin Netanyahu at the start of an urgent meeting with the security cabinet.
Israel said its preemptive strikes were aimed at thwart a major attack by Iran-backed Hezbollah– after the death of the high military commander Fuad Shukr in an Israeli offensive in late July, Reuters reports.
Hezbollah, for its part, said its bombing was in retaliation for the killing of this commander, one of its most important.
Market analysis for oil prices
“Crude oil rose on Friday along with other risk assets, and bulls are joining in today on news that Israel declared a 48-hour state of emergency “after launching a preemptive strike against Hezbollah sites in southern Lebanon in anticipation of a response to the assassination of its military chief last month,” writes Ipek Ozkardeskaya, senior analyst at Swissquote Bank, in her daily market analysis.
What happened this weekend constitutes The most dangerous confrontation between Israel and Hezbollah in 10 months since the fighting was renewed. Attention is now back on the talks for a ceasefire in Gaza taking place in Cairo, which It seems that they continue despite what happened.
“The timing of the Hezbollah attack was surprisinggiven that negotiations for a ceasefire in Gaza are underway. Iran, whose leaders have vowed to avenge the killing of Hamas leader Ismail Haniyeh on its soil in early August, had previously said it would delay its response and give time to peace talks. The next question is If recent developments jeopardize the (ceasefire) talks and change Iran’s calculation“, Danske Bank said.
The direct impact of the rise in oil prices at an international level is the pressure on the local prices and improved profits for those who invest in commodity-linked stocks. For Argentine exportsThus, the rise in crude oil prices is good news, as it improves the trade balance.
Source: Ambito
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