The price of oil rose above US$87 a barrel Monday in Asia as the conflict between Israel and Hamas showed no signs of abating, raising concerns about crude supplies.
Benchmark oil for December delivery was up 81 cents to US$87.73 per barrel at midday Bangkok time in electronic trading on the New York Mercantile Exchange. The contract added US$1.05 to finish at US$86.92 per barrel on Friday.
Brent crude, used to price many international varieties of oil, rose 55 cents to US$109.50. It closed Friday at US$108.95 per barrel in London.
Gordon Kwan, head of energy research at Mirae Asset Securities Ltd. in Hong Kong, said some investors fear that oil supplies could be disrupted if the Israel-Hamas conflict engulfs countries elsewhere in the Middle East, a huge producer of crude.
The “market is putting a geopolitical premium on the price of oil amid escalating tensions between Israel and Palestine and that could continue for some time,” Kwan said. The fighting comes just as winter arrives in the U.S. and China, at time when energy demands climb.