In the aftermath of the surge, markets are closely watching developments in the conflict between Israel and Hamas. While oil prices jumped nearly 5% on Monday, they stabilized on Tuesday. After rising from $84.5 to $88 at the beginning of the week, the price of a barrel of Brent crude has since fallen slightly to around $87.7. At 11:30 a.m., it reached $88.01. The same goes for WTI, or West Texas Intermediate, a barrel, which stood at $86.27, down from $82.8 at the end of last week.
Since the offensive, observers have been cautious. In a note published on Monday, IFPEN said the Hamas attack is unlikely to lead to a spike in prices, as producing countries are not threatened. However, there are two caveats: first, uncertainty will increase price volatility. After that, everything will depend on how the situation evolves, and more specifically whether the conflict spreads to other nations, including Iran. In the event of retaliation against the Islamic Republic, "the repercussions on the oil market could be significant and lead to a surge in prices, with the Persian Gulf region, with the Strait of Hormuz in particular, being crucial for global oil supplies," IFPEN warned.
The situation in Israel "adds to the economic uncertainty," said Tuesday the governor of the Bank of France, François Villeroy de Galhau. Yesterday, prices "rose, relatively moderately, by about 4%," he told FranceInfo. But the situation is not comparable to the 1973 conflict, which led to an explosion in prices, he said: at that time, "there was a generalized conflict, with an embargo decreed by all oil-producing countries." For the time being, nothing comparable is visible in the Middle East, and the prices of non-energy commodities remain on a downward trend, an encouraging signal, the governor said.
The same is true of the French government. After Bruno Le Maire on Monday, who said he expected "limited" consequences of the conflict - provided that a "regional conflagration" was avoided - Olivier Véran was in turn reassuring. Interviewed on FranceInfo on Tuesday, the executive's spokesman said it was "too early" to predict the evolution of oil, stressing that the authorities will be "there" in the event of a surge in prices.
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Prices were starting to come down
Observers therefore remain cautious, waiting to see how the conflict will evolve, and whether Iran is likely to be affected. However, this new and sudden surge in tensions comes at a time when prices were trending downwards. "For the past few days, the price of fuel and oil has tended to fall," Véran said. This observation was also noted by IFPEN, for which "the bullish rally observed over the last five weeks finally seems to be losing its strength".
In France, fuel prices have fallen since the end of September. Between 25 September and 9 October, the price of a litre of diesel fell by four cents, while that of SP95-E10 fell by eight cents. The symbolic threshold of two euros is receding, for the time being. This is due to the fall in oil prices, and the operations carried out by the various distributors in France, whether it is sales at cost price or the TotalEnergies ceiling. Will this trend continue, or will the crisis stop it, or even cause prices to rise again? "The point to watch the most is the possible extension of the conflict," concluded François Villeroy de Galhau on Tuesday.