Brent Caught Between Supply and Demand Fears at $108
By Laura Brodbeck | November 17, 2012 1:15 AM EST
Tension in the Middle East continued to lend support to Brent prices on Friday as concerns about global demand in the future capped gains. The commodity traded at $108.32 on Friday morning, reflecting gains after fighting in the Gaza strip stoked investor fears of supply interruptions.
Reuters reported that many believe oil prices wedged between supply fears and demand concerns will be good for the global economy because it keeps prices stable.
An Israeli airstrike which killed a Hamas military chief on the Gaza Strip this week is expected to be only the beginning of a violent conflict between Israelis and Palestinians. Brent has been supported all year by the tension in the area, but after this violent airstrike, many investors are concerned that Arab producers will be pulled into the conflict.
Also on investors' minds is the nuclear development program in Iran. The country has continued to move forward with uranium enrichment against the wishes of the U.S. and Europe. After several threats of retaliation to military action, the heavily sanctioned country is furthering the program in an underground nuclear plant. This has led many to believe that there is no peaceful outcome for the standoff between Iran and the West.
As the US struggles to reach a decision before the looming ‘fiscal cliff', uncertainty surrounding the number one oil consumer has weighed heavily on Brent prices. That, coupled with Europe's debt crisis, is enough to drive prices to a new low. However, the geopolitical tension has balanced out losses due to struggling global economies.
(c) 2012 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Copyright Benzinga. All rights reserved.
Most Popular Slideshows
- Flight MH17 Attack: Russians Claim 'Putin A Terrorist,' Memorial at Dutch Embassy Overflows [PHOTOS]
- Typhoon Rammasun Claims 18 Lives in China, Incurs $4.32B Losses (PHOTOS)
- Ellen DeGeneres Caught Cheating with Mutual Friend Before Portia de Rossi’s Rehab – Reports [PHOTOS]
- Selena Gomez Turns 22 Today, Celebrates Early without Justin Bieber: Top 12 Interesting Facts About the Singer [SEE PHOTOS]
Join the Conversation
- Alibaba Okays Yahoo Request to Sell 140 Million Shares Via IPO, 68 Million to Be Sold to Shareholders
- Global Markets Overview – July 24, 2014
- Australian Stock Market Report – Morning July 24, 2014
- Australian Stock Market Report – Afternoon July 23, 2014
- Australian Stock Market Report – Midday July 23, 2014
- Samsung Galaxy Note 4 Apps Leak Online, Five Fresh Features to Expect from the Android Smartphone
- Moto 360 Price Speculations, Key Features, Strategic Release Date, Design: A Watch That is More Than Just Time
- Windows Phone 8.1 Update Rollout: 20 Nokia Lumia Phones Eligible and 13 New Features to be Added
- Google Nexus 8 Release Date Soon Along with 2 More HTC Android Tablets – Reports
- Three New Moto G Successors Spotted in FCC Document Dubbed Moto G2, Moto M and More --Reports
- iPad Air 2 Release Date Will Skip IGZO Panel; To Rollout with Super-Slim iPad Mini Air
- Upcoming iPad Mini 3 Could be 30% Thinner and Likely be Called iPad Mini Air; Apple Q3 Results Show 9% Decrease in iPad Sales