2023-10-10 11:56:59
By WGB
Published 6 minutes ago, Updated now
Since the offensive, several observers have been cautious, calling not to panic. DADO RUVIC / REUTERS
“The point to watch most is the possible extension of the conflict,” said the governor of the Bank of France on Tuesday.
In the aftermath of the outbreak, markets are closely watching developments in the conflict between Israel and Hamas. While oil prices jumped by almost 5% on Monday, they stabilized on Tuesday. Having gone from 84.5 to 88 dollars at the start of the week, the price of a barrel of Brent has since fallen slightly to around 87.7 dollars. At 11:30 a.m., it reached $88.01. The same goes for a barrel of WTI, or West Texas Intermediate, which stood at $86.27, compared to 82.8 at the end of last week.
Since the offensive, observers have been cautious. In note published Monday, IFPEN estimated that the Hamas attack should not lead to a surge in prices, as the producing countries were not threatened. Two clarifications, however: first, uncertainty will increase price volatility. Then, everything will depend on the evolution of the situation, and more particularly on an extension of the conflict to other nations, including Iran. In the event of reprisals against the Islamic Republic, “the repercussions on the oil market could be significant and lead to a surge in prices, the Persian Gulf region, with the Strait of Hormuz in particular being crucial for global oil supplies», warned IFPEN.
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The situation in Israeladds to economic uncertainty», noted this Tuesday the governor of the Bank of France, François Villeroy de Galhau. Yesterday, prices “rose, relatively moderately, by about 4%», he indicated, speaking to FranceInfo. But the situation is not comparable to the conflict of 1973, which led to an explosion in prices, the representative clarified: at the time, “there was widespread conflict, with an embargo declared by all oil-producing countries“. For the moment, nothing comparable is visible in the Middle East, and the prices of commodities other than energy remain on a downward trend, an encouraging signal, considered the governor.
Same observation from the French government. After Bruno Le Maire, Monday, who said he expected consequences “limited» of the conflict – provided, however, that we avoid a “regional conflagration» -, Olivier Véran in turn wanted to be reassuring. Questioned on FranceInfo on Tuesday, the spokesperson for the executive estimated that it was “too early» to forecast oil developments, stressing that the authorities will be “the appointment”, in the event of a price surge.
Also readHamas attack on Israel: is the price of oil likely to skyrocket?
Prices started to fall
Observers therefore remain cautious, waiting to see how the conflict will evolve, and whether Iran risks being affected. The fact remains that this new and sudden surge in tensions comes at a time when prices were on a downward trend. “In recent days, the price of fuel and a barrel has tended to fall», noted Olivier Véran. An observation also noted by IFPEN, for which “the bullish rally observed over the past five weeks finally appears to be losing steam».
In France, fuel prices have fallen since the end of September. Between September 25 and October 9, the liter of diesel fell by four cents, and that of SP95-E10 by eight cents. The symbolic bar of two euros is moving away, for the time being. An effect of the fall in oil prices, and the operations carried out by the various distributors in France, whether sales at cost or the TotalEnergies ceiling. Will this trend continue, or will the crisis stop it, or even cause prices to rise again? “The point to watch most is the possible extension of the conflict», concluded François Villeroy de Galhau on Tuesday.
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