Uncertainty Lingering Over Global Oil Prices Due To Israel-Hamas War

27 October 2023

The oil prices were affected due to the unprecedented war that started out between Israel and Hamas on 7 October 2023. The conflict between these nations shook the global oil market due to the significance of the Middle East in the contribution of global oil supplies. The oil prices on Tuesday (24 October) slumped even further following the minor recovery in the previous week. Trade experts suggested that this could potentially disturb the confluence of oil supplies between the countries, especially ones which rely on the Middle East.

Middle East Fuels & Oils Exports

The exports of mineral fuels and oils from the Middle East from 2018 to 2022 are shown below. The value of exports accounted in the following manner: $675.1 billion in 2018, followed by $378.1 billion in 2019, $489.7 billion in 2020, $737.4 billion in 2021 and $965.1 billion in 2022.

The top five exports among Chapter 27 (Mineral Fuels and Oils) from the Middle East for 2022 include—Crude Oil ($640.8 billion), Refined Petroleum ($165.2 billion), Petroleum Gas and other Gases ($138 billion), Petroleum Coke ($4.8 billion), and Oils & Coal Tar ($1.5 billion).

 Below given table shows the Middle East's top exports in Chapter 27 reported in 2022.

Middle East Crude Oil Exports

As we observed from the above table, crude oil from the Middle East are highest among all the lines of commodities in Chapter 27. The exports of crude oil from the Middle East in the past three years amounted to—$603.5 billion in 2020, $866.3 billion in 2021, and $1.5 trillion in 2022.

In 2022, Middle East’s crude oil was exported to—China ($195.6 billion), India ($103.1 billion), Japan ($95.1 billion), South Korea ($67 billion), the USA ($25.8 billion), Thailand ($22.2 billion), Taipei ($22.1 billion), Singapore ($16.7 billion), the Netherlands ($9.5 billion), and Malaysia ($9.3 billion).

As the conflict between Israel and Palestine’s Hamas exists, the ambiguity in the global oil market will cease to exist. The highest quantities of supplies for oil and related products are shipped out from the Middle East region, and it can hugely affect global oil prices and trade.