Oil futures rise on worries about supply disruptions
London (Nov 16) Oil futures advanced early Monday, with analysts citing fears about supply disruptions after France launched airstrikes in Syria following terror attacks in Paris.
West Texas Intermediate crude for December delivery CLZ5, +2.68% gained 36 cents, or 0.9%, to $41.10 a barrel, while January Brent crude LCOF6, +1.42% rose by 31 cents, or 0.7%, to $44.78 a barrel.
French war planes went into action on Sunday, conducting airstrikes on Islamic State’s stronghold in Syria a day after French President François Hollande vowed a “merciless” response to the attacks.
France launches airstrikes against Islamic State
France responded with force after the Paris terrorist attacks by launching extensive airstrikes against Islamic State.
With France sending its fighter jets into Syria, traders have “angst that perhaps this will disrupt the oil supply,” said Naeem Aslam, chief market analyst at AvaTrade, in a note on Monday.
Aslam said he sees “very little signs of fading this rally for the time being, unless the geopolitical situation eases off.”
Oil is coming off a big weekly decline, with front-month Nymex crude for December delivery losing 8% in the prior week, according to Dow Jones data. That represents the largest one-week percentage drop since March.
In U.S. economic news on Monday, a November reading for the Empire State Manufacturing Survey is due at 8:30 a.m. Eastern Time. The survey provides details on the health of New York state’s manufacturing sector.