Israel-Hamas conflict worries commodity markets
Raw material markets entered the final quarter in the shadow of conflicts in the Middle East. Oil prices continue to climb. Safe-haven gold is at a 7-month high. Base metals remain calm due to fears of recession. In agriculture, prices are expected to rise due to supply concerns.
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Following the Russia-Ukraine war and high interest rates, conflicts in the Middle East have been added to the global investor's list of concerns. The possibility of the Israel-Hamas war spreading creates a risk of recession in the world economy. On the other hand, the Fed's interest rates remain at the center of investor focus. In the final quarter of the year, oil, precious metals, and agricultural commodities appear stronger than industrial metals.
The Israel-Hamas conflict is particularly affecting the prices of commodities such as oil, natural gas, gold, and silver. Changes in oil and gas prices may generally vary depending on the intensity and duration of the conflict, as well as its proximity to energy facilities and shipping routes in the region.
BRENT COULD HEAD TO 100 DOLLARS
The price of Brent crude oil has increased by more than 5 percent in the last week, exceeding 90 dollars per barrel. Iran stands out as the biggest source of concern in this area. Vivek Dhar, an energy analyst at Commonwealth Bank of Australia, states that the main concern is Iran's oil supply and exports. Dhar says that the US confirming the involvement of the Iranian Revolutionary Guard Corps in the attack would encourage a more rigorous enforcement of existing sanctions against Iran. It is stated that this situation could push the price of a barrel of Brent crude above 100 dollars.
GOLD AND SILVER PRICES ARE ACTIVE
Gold and silver prices are gaining value due to investors' search for a safe haven. The ounce price of gold has risen to 1,930 dollars, reaching its highest level in 7 months. Weekly gains exceeded 5 percent. Silver has similarly provided a return of more than 5 percent and moved toward 23 dollars.
Other commodity products are looking at many factors to take positions, such as war-induced recession, inflationary pressures caused by high oil prices, the path to be followed in Fed interest rates, production shortages arising from bad weather conditions, and supply issues.