The market may be tumbling on Monday but that hasn't stopped the energy sector from charging higher today.
In morning trade, a number of ASX 200 energy shares are recording solid gains after oil prices jumped on Friday night.
Here's the state of play at the time of writing:
- The Beach Energy Ltd (ASX: BPT) share price is up almost 3% to $1.58.
- The Karoon Energy Ltd (ASX: KAR) share price is up 3.5% to $2.70.
- The Santos Ltd (ASX: STO) share price is up 1.5% to $7.75.
- The Woodside Energy Group Ltd (ASX: WDS) share price is up 1.5% to $36.20.
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Why are ASX 200 energy shares rising?
As mentioned above, investors have been buying ASX 200 energy shares on Monday after oil prices raced notably higher on Friday night's session. This was driven by rising tensions in the Middle East.
According to Bloomberg, the WTI crude oil price was up 5.8% to US$87.69 a barrel and the Brent crude oil price was up 5.7% to US$90.89 a barrel. This helped oil record its biggest weekly gain in almost two months.
Unfortunately for consumers (and central banks wanting to tame inflation), some analysts believe that oil prices could keep rising from here. This could mean even higher petrol prices in the near term.
According to the Financial Times, global energy strategist at Rabobank Joe DeLaura believes that "we're headed to $100 [a barrel] no matter what this quarter."
This sentiment was echoed by the head of commodity strategy at Saxo Bank, Ole Hansen. He said:
Prices could easily get a lot worse [higher] before we find some stabilisation. No one in the right frame of mind would hold a short position [in oil] when Israel has just ordered 1mn people to leave [northern] Gaza. That threatens a massive escalation.
