Oil prices climb on Israel-Hamas tensions

September 10, 2025 (MLN): Oil prices moved upward on Wednesday following reports that Israel targeted Hamas leaders in Qatar and after U.S. President Donald Trump pressed Europe to slap tariffs on Russian oil buyers.

However, broader market concerns curbed the rally.

Brent crude futures went up by $0.73, or 1.1%, to $67.12 per barrel.

West Texas Intermediate (WTI) crude futures increased by $0.69, or 1.1%, to $63.32 per barrel by [10:30 am] PST.

Crude had already gained 0.6% a day earlier after Israel confirmed strikes on Hamas leadership in Doha, an incident Qatar’s prime minister warned could jeopardize ongoing peace talks.

Prices initially spiked nearly 2% in reaction to the news but eased back when Washington reassured Doha that such actions would not recur on Qatari soil.

“The muted follow-through in oil despite these headlines, alongside doubts about President Trump’s push for tougher sanctions on Russian energy, leaves crude vulnerable to more downside,” said Tony Sycamore, analyst at IG Markets.

Trump has called on the European Union to impose tariffs of up to 100% on imports tied to China and India, two of Russia’s biggest oil customers.

Their continued purchases have provided Moscow with crucial revenues since the invasion of Ukraine in 2022 despite existing Western sanctions.

Analysts at LSEG noted that extending punitive measures to major buyers like China could squeeze Russian crude flows and tighten global supply supportive for prices in theory.

Yet they cautioned that aggressive action might clash with the U.S. administration’s efforts to rein in inflation and influence the Federal Reserve ahead of expected interest rate cuts.

Traders are widely anticipating a Fed rate reduction next week, which could stimulate demand and provide some relief to oil markets. Still, underlying conditions remain weak.

The U.S. Energy Information Administration has warned that rising inventories and higher OPEC+ production are likely to exert downward pressure on crude prices in the months ahead.

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