Oil prices up ahead of Fed meeting, ongoing Israel-Palestine conflict

​​​​​Oil prices increased on Wednesday over rising supply worries fueled by Israel’s widening air and ground attacks on the Gaza Strip and ahead of the US Federal Reserve (Fed) meeting.

International benchmark crude Brent traded at $85.72 per barrel at 10.34 a.m. local time (0734 GMT), a 0.82% rise from the closing price of $85.02 a barrel in the previous trading session on Tuesday.

The American benchmark West Texas Intermediate (WTI) traded at the same time at $81.11 per barrel, up 0.11% from Tuesday’s close of $81.02 per barrel.

Israeli airstrikes Tuesday on the Jabalia refugee camp in northern Gaza, left hundreds dead and injured, deepening concerns that oil supply routes might be disrupted.

Qatar strongly condemned ‘the Israeli occupation’s bombing of the Jabalia camp in Gaza,’ according to a statement by its Foreign Ministry, describing the attack as ‘a new massacre against the defenseless Palestinian people and called on the international community to act quickly to stop the killing and destruction.’

However, price increases were blunted as investors await Fed’s monetary policy decisions on late Wednesday and Fed Chair Jerome Powell’s remarks following the meeting, which are expected to maintain the policy rate high for longer than anticipated.

Further price increases were limited by the American Petroleum Institute’s (API) announcement on Tuesday, estimating a rise in US crude oil stockpiles of 1.3 million barrels, against the market expectation of an increase of 1.6 million barrels. The data indicated a decrease in the world’s biggest oil consumer country’s oil demand.

Meanwhile, additional price increases were also tempered by concerns that China, the world’s top oil importer, would experience a decline in oil consumption as a result of lower than anticipated industrial activity data.

• US Federal Reserve (Fed)