Oil prices head for weekly gains as Israel rejects ceasefire offer

By Stephanie Kelly

(Reuters) – Oil prices rose in early trading on Friday, on track for a weekly gain, as tensions remain high in the Middle East after Israel rejected a ceasefire proposal from Hamas.

By 0119 GMT, Brent futures were up 8 cents, or 0.1%, at $81.71 a barrel, while U.S. West Texas Intermediate crude futures were up 17 cents, or 0.2%, at $76.39 a barrel.

Oil prices rose nearly 3% in the previous session as Israeli forces bombed the southern border city of Rafah on Thursday after Prime Minister Benjamin Netanyahu rejected a proposal to end the war in the Palestinian territory.

Oil prices remain high due to the tensions, with Brent and WTI both up 5.7% for the week.

US officials issued their sharpest criticism yet of Israel’s civilian casualties in Gaza as it shifted the focus of its offensive to Rafah.

A Hamas delegation arrived in Cairo on Thursday for ceasefire talks with mediators Egypt and Qatar.

Although the conflict has increased prices, there has been no impact on oil production.

However, along with the Ukraine conflict, a combination of drone attacks on Russian refineries and technical disruptions have led the country to export more crude than planned in February, breaking its pledge to curb sales under the OPEC+ agreement. Can weaken.

Under the agreement with the Organization of the Petroleum Exporting Countries and allies, known as OPEC+, Russia has committed to cap crude oil output at 9.5 million barrels per day (bpd). It is voluntarily cutting crude oil exports by 300,000 bpd and fuel exports by 200,000 bpd from the average May-June level.

(Reporting by Stephanie Kelly; Editing by Sonali Paul)

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