Oil prices rose 3%, but then fell amid false reports of a rocket hitting a hospital in Gaza
Humanity is increasingly dependent on information, so authentic news is increasingly important in an era of fast-spreading fake news that affects markets and decisions. The news that an Israeli rocket hit a hospital in Gaza and killed more than 500 people was quickly spread by all world agencies without providing any confirmation. Within a day, there were confirmed data that it was a Hamas rocket, which fell on the parking lot near the hospital after being fired, so there were no significant casualties.
On the first news, December Brent crude futures rose 3% to a two-week high of $93/barrel, as Iran called on Muslim countries to impose an oil embargo against Israel over the attack on the hospital. However, the appearance of detailed information and President Biden's statement that Israel was not involved in the explosion lowered the quotation.
Rising tensions in the Middle East are roiling markets and fueling speculative spikes in stock and commodity markets. Oil prices fell even despite a negative weekly report from the EIA, which showed U.S. crude inventories fell by 4.49 million barrels and gasoline inventories by 2.37 million barrels, while traders had expected a decline of 0.55 and 0.1 million barrels, respectively. Crude oil stocks in Cushing, the WTI futures delivery base, fell by 758,000 barrels to an almost 9-year low.
U.S. natural gas prices fell for a sixth straight session amid warm weather in much of the east, dampening demand for heating and air-conditioning gas. The fall slows Friday's rise in EU natural gas prices to an 8-month high on possible supply disruptions after Chevron shut down a natural gas field in Israel following a Hamas attack for security reasons.
Escalation of the conflict between Israel and Hamas will be the main factor supporting gas and oil prices in the near term, but strong US diplomatic pressure on both sides could reduce the risk of escalation of hostilities and cancel the Israeli operation in the Gaza Strip.
