Oil prices climb on new Gaza-Israel fears

Associated Press Modified: November 23, 2012 at 2:00 pm •  Published: November 23, 2012
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NEW YORK (AP) — Oil prices climbed Friday after Israeli troops fired on crowds in Gaza surging toward the border fence, killing one Palestinian.

Benchmark crude ended the trading day up 90 cents to $88.28 a barrel on the New York Mercantile Exchange.

Brent, which is used to price international varieties of oil, was up 83 cents to $111.38 a barrel.

Friday's killing is the first violence since a truce between Israel and the militant Hamas group was reached two days ago. Prior to the shooting, oil prices had been falling, thanks mostly to optimism over the stability in the region that the cease-fire agreement provided.

Israel launched an offensive on Nov. 14 to halt rocket fire from Gaza, unleashing some 1,500 airstrikes on Hamas-linked targets, while Hamas and other Gaza militants showered Israel with just as many rockets. The truce reached Wednesday had eased fears of a war that could broaden beyond Gaza and eventually disrupt oil supplies.

Paul Tossetti, senior director of markets and country strategies at PFC Energy, said prices were linked to the action in Gaza but that he expects this to be a temporary bump and that the cease fire would ultimately hold.

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