Proactive Investors - Respective hits to gas production in Finland and Israel saw prices in the UK hit a six-month high on Tuesday afternoon.
Following Saturday’s attack on Israel and the proceeding declaration of war against Palestinian militants from the Hamas group, major producer Chevron Corporation (NYSE:CVX) has closed a gas field off the country’s coast.
Finland has reported damage causing a leak in its Balticconnector pipeline meanwhile, which transports gas between Estonia and Finland.
Though the cause of the damage is not yet known, Finnish prime minister Petteri Orpo pointed to “external action” as “likely” being to blame.
The UK gas price jumped as high as 124.98p per British thermal unit on Tuesday afternoon as a result, as per Trading Economics, marking its highest since early April.
It subsequently subsided to 118.73p on Wednesday morning.
According to Liberum analysts, the current situation in the war between Israel and Hamas should not weigh on prices too drastically.
“The larger questions going forward are the actions of the US, Iran, Russia and China,” analysts said.
Both president Biden and prime minister Rishi Sunak have expressed support for Israel since the conflict, which is reported to have claimed the lives of 1,200 people in Israel, broke out on Saturday.
“If Middle East oil and gas flows are considered at risk via a broader event prices will escalate far further,” Liberum added.
Orpo reassured that Finland’s in and outgoing supply was not at risk from the damage to the pipeline.
“It is too early to draw conclusions on who or what caused the damage,” he added.