A U.S. warship intercepted missiles coming from Yemen on Thursday, adding to tensions in the Middle East after Hamas attacked Israel almost two weeks ago.
The fear for investors is that a wider war could disrupt supplies of oil, since neighboring Iran and Saudi Arabia are major global producers. Traders may also flock to haven assets such as gold as protection against uncertainty.
Following the missile interceptions in Yemen, gold and oil rose. It came a day after President Joe Biden returned from Israel where he reaffirmed U.S. support for the country and argued the rocket that landed near a hospital in Gaza earlier in the week probably wasn’t fired by Israel.
Oil prices have risen back above $90. West Texas Intermediate, the U.S. benchmark, was up 1.2% to $90.40 a barrel, having gained more than 3% in the past week. Brent crude, the international standard, added 0.9% to $93.18 a barrel. Gold prices were up 0.7% on Friday to $1,993.30 an ounce.
In separate oil news, the U.S. government said it would buy oil for the Strategic Petroleum Reserve, which adds to demand for the commodity. On the other side, a new U.S. agreement with Venezuela to allow more exports in exchange for political reform could eventually add to global supply.
Fears that the Hamas-Israel conflict will escalate are unlikely to abate over the weekend. Oil and gold will continue to be volatile.
Write to Brian Swint at [email protected]
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