Oil Futures Surge Following Israeli Strike

Oil futures saw a significant rise on Friday after reports emerged that more than 100 Palestinians waiting for aid in Gaza had been killed in an Israeli strike the day before.

President Joe Biden acknowledged that these deaths would complicate ongoing talks around a cease-fire between Israel and Hamas. Earlier in the week, Biden had expressed optimism about a potential agreement by Monday.

Key Market Movements:

• West Texas Intermediate crude for April delivery climbed by $1.24, reaching $79.50 per barrel on the New York Mercantile Exchange.
• May Brent crude, the global benchmark, rose by $1.25 to $83.16 per barrel on ICE Futures Europe.

Ewa Manthey and Warren Patterson, commodity strategists at ING, noted that the oil market experienced modest gains due to the escalation of tensions in Gaza, leading to an increase in risk sentiment.

OPEC+ Decision Awaited

Investors are also eagerly awaiting a decision by OPEC+ regarding the extension of voluntary production cuts into the second quarter. The alliance, consisting of OPEC members and their allies, are considering extending cuts amounting to 2.2 million barrels per day into the next quarter.

Carsten Fritsch, commodity strategist at Commerzbank, highlighted that sticking to the voluntary production cuts until the year-end would be viewed positively as it would ensure a tight oil market. However, if the extension is only for the second quarter, it may not have a significant impact on prices.