Oil prices push higher amid escalating Middle East conflict

(Alliance News) - Oil rises rose on Friday in response to developments in the Middle East, as continuing anxiety pushes the price higher.

Energy prices managed to remain in positive territory amid heightened Middle East tensions, which threatens to block trade through the Red Sea. Brent oil was quoted at USD79.02 a barrel in London on Friday afternoon, up from USD78.61 late Thursday.

"The markets are reacting to increased tension in the Middle East, with the fallout from the conflict in Gaza threatening to envelop the entire region and block the Red Sea route, which is heavily used by oil tankers," ActivTrades analyst Ricardo Evangelista said.

The latest developments, including an air strike between Pakistan and Iran, underscore the potential for escalation of the ongoing war in Gaza, Evangelista said.

Israel bombarded southern Gaza on Friday after it publicly sparred with the US over the possibility of a Palestinian state, AFP reported.

Tensions between nuclear-armed Islamabad, a US ally, and Washington's foe Tehran have soared after Iran struck alleged militant targets in Pakistan and Pakistan responded in kind, according to AFP.

"The convergence of positive fundamentals and ongoing geopolitical concerns, such as continued attacks on Red Sea shipping and retaliatory strikes between Pakistan and Iran, suggests that crude oil prices might see upward momentum driven by fears of weekend headline developments," Stephen Innes of SPI Asset Management said.

By Sophie Rose, Alliance News senior reporter

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