Israel-Hamas war could cause oil price hike – World Bank

The World Bank has warned that if the war between Israel and Hamas expands across the Middle East, it might cause price shocks for raw goods such as oil and agricultural supplies.

The World Bank issued this warning in a report on Monday.

Oi prices, according to Israeli officials, have already risen by 6% since the recent wave of violence, which began when Hamas militants from Gaza attacked southern Israel, murdering over 1,400 people, the majority of whom were civilians, and taking over 240 hostages.

Israel has retaliated with an unrelenting bombing of Gaza, which, according to the Hamas-run health ministry, has killed over 8,000 people, over half of whom are children.

The battle between Israel and Hamas comes as Russia’s war in Ukraine has already put pressure on markets, calling it “the biggest shock to commodity markets since the 1970s,” according to World Bank head economist Indermit Gill.

“That had disruptive effects on the global economy that persist to this day,” Gill said in a statement.

“Policymakers will need to be vigilant. If the conflict were to escalate, the global economy would face a dual energy shock for the first time in decades” from both the war in Ukraine and the conflict in the Middle East, he said.

The World Bank also stated that any possible price increases will be determined by global oil prices and exports.

Oil might rise between $93 and $102 per barrel in an optimistic scenario.

A median scenario would see oil prices rise to $121, while a worst-case scenario would see oil prices rise to between $140 and $157, perhaps exceeding all-time highs not seen since 2008.