Prices had jumped as much as 12 percent on Monday after Israel launched its fiercest air offensive in the Hamas-ruled Gaza strip in decades. Hamas sent missiles deep into Israel on Monday, three days into Israel’s punishing air offensive in Gaza. Four Israelis, including a soldier, were killed and eight wounded. Palestinian health officials put the three-day death toll in Gaza at 364; the U.N. said the total included at least 62 civilians.
Early Tuesday, Israeli aircraft dropped at least 16 bombs on five Hamas government buildings in a Gaza City complex, destroying them, witnesses said. Israel’s defense minister Ehud Barak promised a “war to the bitter end against Hamas” and allied militants.
Oil fell below $39 a barrel on Tuesday, pressured by gloom about prospects for world economic growth which outweighed heightened tensions in the Middle East due to the Israeli-Hamas conflict.
“With most global economies struggling and credit markets still in an impaired state, it is hard to get too excited about the upside potential in energy markets attributable solely to geopolitical factors unless, of course, these are directed at the heart of the oil supply system,” said Edward Meir, fuel blipped upward over the past few days because of the fighting. But with the conflict in its fourth day Tuesday, the fuel market refocused on the turmoil roiling economies internationally — and the negative fallout for oil demand.
Tomorrow’s fuel inventory numbers will start to gain more attention from traders as well. Market expectations call for slight builds/increases in product stocks and refinery utilization with a slight decline in crude stocks. In a slow week of fuel trading, fuel costs will rest in inventory numbers.
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