By Yuka Obayashi
Oil Prices Surge in Asian Trading Amid Middle East Conflict Concerns
Oil prices experienced a significant increase in early Asian trade on Tuesday, reversing the previous session’s loss. The surge comes as worries about an escalating conflict in the Middle East impacting supplies outweigh concerns about a potential U.S. recession affecting demand in the world’s leading oil consumer.
Several U.S. personnel were reportedly injured in an attack on a military base in Iraq on Monday, heightening tensions in the region following the recent killings of key members of militant groups Hamas and Hezbollah.
U.S. West Texas Intermediate crude futures saw a rise of $1.18, or 1.6%, reaching $74.12 per barrel during early trade in Asia.
While both WTI and benchmark prices fell by 0.7-0.8% on Monday amid a global stock market selloff, the decline in oil prices was limited due to concerns that Iran may retaliate for the assassination of a Hamas leader in Tehran, potentially leading to a wider conflict in the Middle East.
Additionally, a senior ally of President Vladimir Putin visited Tehran on Monday for talks with Iranian leaders, including the president and top security officials, as Iran deliberates its response to the Hamas leader’s killing.
Israeli Prime Minister Benjamin Netanyahu is facing criticism in Israel and abroad for his handling of Gaza ceasefire negotiations, which have stalled. There are growing fears that the situation could escalate into a conflict with Iran.
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### Analysis:
Oil prices surged in Asian trading due to concerns about escalating conflicts in the Middle East, leading to a reversal of previous losses. The potential impact on oil supplies from the region outweighed worries about a U.S. recession affecting demand. Tensions rose following reports of U.S. personnel injuries in Iraq and the recent killings of key militant group members. The market also reacted to fears of retaliation from Iran and stalled ceasefire talks in Gaza, raising the possibility of wider conflicts. These developments could have significant implications for global oil markets and investors’ portfolios.