Oil prices rally after falling below $80 per barrel

By Duygu Alhan

Oil prices rebounded on Thursday after falling more than 2.3% due to moderate investor profit-taking and supply risks from the escalating tension between Israel and Palestine.

International benchmark crude Brent traded at $80.11 per barrel at 10.24 a.m. local time (0724GMT), a 0.71% rise from the closing price of $79.54 a barrel in the previous trading session on Wednesday.

The American benchmark West Texas Intermediate (WTI) traded at the same time at $75.82 per barrel, up 0.65% from Wednesday's close of $75.33 per barrel.

The Israeli-Palestinian conflict's intensification has raised supply concerns, which are continuing to pressure prices and carry a risk of destabilizing the region and sabotaging oil supply routes.

In an official letter to Rafael Mariano Grossi, the director-general of the International Atomic Energy Agency (IAEA), on Wednesday, Palestinian Foreign Minister Riyad al-Maliki stated that a nuclear threat is "completely consistent with the prevailing discourse in Israel" against Palestinians, according to the Palestinian official news agency.

However, Lisa Cook, a member of the US Federal Reserve board of governors, said on Wednesday that rising geopolitical tensions could exacerbate China's and Europe's already weak growth rates, which could alter the trajectory of the US economy and prevent further price increases.

Data on a fall in China’s Price Index, which fell 2.7% yearly and 0.2% monthly in October, relieved oil prices and once again raised deflationary concerns.

Meanwhile, contrary to market anticipations of a loss of 300,000 barrels in US crude oil stockpiles, the American Petroleum Institute (API) announced Tuesday that inventories had increased by an estimated 11.9 million barrels.

This indicated a fall in the world's largest oil-consuming nation's oil consumption, which in turn limited upward price pressures.