BEIJING (Reuters) – Oil prices rose early on Tuesday after Israel struck Rafah in Gaza as ceasefire negotiations with Hamas continued without a solution.
Brent crude futures were up 46 cents, or 0.55%, at $83.79 a barrel by 0010 GMT, while U.S. West Texas Intermediate (WTI) crude futures rose by 46 cents, or 0.59%, to $78.94 per barrel.
Prices had edged higher on Monday, partially reversing last week’s declines in which both contracts posted their biggest weekly losses in three months, with focus on weak U.S. jobs data. United and on the possible timeline for an interest rate cut from the Federal Reserve.
Palestinian militant group Hamas accepted a Gaza ceasefire proposal from mediators on Monday, but Israel said the conditions did not meet its demands and continued its strikes in Rafah while planning to continue negotiations on a deal.
Israeli forces struck Rafah, on the southern edge of Gaza, from the air and on the ground, and ordered residents to leave parts of the city, which has served as a refuge for more than a million displaced Palestinians.
The lack of a settlement between the sides in the now seven-month-old conflict has supported prices as investors fear the regional escalation of war could disrupt crude supplies from the Middle East.
Riyadh’s decision to raise official sales prices for its crude sold in June to Asia, northwest Europe and the Mediterranean also supported prices, signaling expectations of strong demand this summer.
The world’s top exporter raised the price of its Arab Light crude oil to Asia to $2.90 a barrel, above the Oman/Dubai average in June, the highest since January and at the upper range of expectations of traders in a Reuters survey.
(Reporting by Andrew Hayley; editing by Sonali Paul)
