World oil prices rose in Asian trade today, fuelled by the ongoing conflict in the Middle East after Israel stepped up its military onslaught on Gaza, analysts said.
New York's main contract, light sweet crude for February delivery, gained 65 cents to $46.99 a barrel. The contract closed $1.74 higher at $46.34 Friday on the New York Mercantile Exchange.
Brent North Sea crude for February delivery was trading $1.09 higher at $48.00 today after closing $1.32 higher at $46.91 on Friday.
"The Gaza conflict added to the geopolitical risk premium embodied in the oil price," said David Moore, a Sydney-based commodity strategist with the Commonwealth Bank of Australia.
Israel poured ground troops into Gaza late on Saturday, stepping up an eight day long bombing campaign of Hamas targets, aimed at ending the Islamist movement's rocket attacks across the border.
Despite the spike in oil prices, analysts said the rally was likely unsustainable because of low energy demand caused by a weak global economy.
"It looks like the equity markets have stabilised... (but) overall, the market doesn't look good," said Tony Nunan, manager for energy risk management for Mitsubishi Corp.
"I'm not confident of the market rallying again," he said.
Meanwhile, a row that has seen Moscow cut gas supplies to the Ukrainian market was also a concern for the market, analysts said.
