The combined death toll from the Hamas attack on southern Israel has climbed to more than 1,100 as fighting entered a third day. Oil surged as the conflict threatened to inflame tensions in the Middle East, home to almost a third of global supply.
More than 700 Israelis, most of them civilians, were killed in the attacks which erupted outside the Gaza Strip on Saturday morning. Some 260 bodies were recovered at the site of a music festival that was taking place not far from Gaza’s northern border. About 400 Palestinians have died in fighting and retaliatory attacks, as the Israeli military regained control over most areas breached by militants.
The operation by Hamas — which included taking scores of Israeli hostages — was an unprecedented incursion that has shaken regional stability and markets. Israel officially declared war and says it won’t stop until Hamas’s military infrastructure is dismantled, a task that seems likely to include a ground invasion and take months.
Oil soars on Middle East tensions
Oil surged 5% as Hamas’ surprise attacks on Israel threatened to inflame tensions in the Middle East, home to almost a third of global supply.
See also: Israel and Hezbollah reach ceasefire agreement for Lebanon
West Texas Intermediate traded near $87 a barrel as a war-risk premium returned to markets.
The latest events in Israel don’t pose an immediate threat to oil supply, but there’s a risk the conflict could spiral into a more devastating proxy war, embroiling the US and Iran. Any retaliation against Tehran amid reports it was involved in the attacks could endanger the passage of vessels through the Strait of Hormuz, a vital conduit that Iran has previously threatened to close.
Dollar rises as traders seek havens
The dollar strengthened against most of its major peers from the Asian open as currency traders got their first chance to react to a shock attack by Hamas within Israel.
The greenback — seen as a haven in times of trouble — advanced at least 0.2% versus the euro and pound, while risk currencies such as the Aussie and kiwi weakened.
