Oil prices traded “sharply higher” after the U.S. fired as many as 60 missiles at a Syrian airbase on Thursday in retaliation for a chemical attack earlier this week.
The price of oil jumped by about a dollar per barrel to $52.70 during after hours trading following news of the attack, said a Thursday news release from fuel price tracking website GasBuddy.com.
But it’s still too early to say what will happen to prices at the pump, GasBuddy.com analyst Dan McTeague told Global News.
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“Any type of geopolitical factor always plays into oil,” he said.
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“We’re dealing with nations that are in fact quite embroiled with oil one way or another, but oil tends to be a significant benchmark over and above other commodities and a real reflection fo whether there’s any risk or panic out there.”
Syria, McTeague noted, is not a major oil producer, but the “overall impression” of geopolitical risk can nevertheless have an influence on prices, he added.
READ MORE: Gas prices across Metro Vancouver to drop by 7 cents: expert
“It is usually the first signal of which way the world’s mood is going,” he said.
McTeague also said it’s “too early to tell” what will happen to prices at the pump, which had already gone up in parts of Canada recently.
“We need to see where the market rests and where the market goes during the day tomorrow.”
But McTeague also compared the current situation to an attack on Libya that took place in 2011 — an event that precipitated an increase in oil prices of about $10 per barrel.
The key difference, however, is that there were concerns about Libya’s oil production being taken off line — and that’s less of a problem in Syria’s case.
“This may not have any effect on gasoline, but oil, there’s no doubt that the commodity is not fond of any kind of geopolitical events.” McTeague said.
READ MORE: U.S. missiles blast Syrian air base from where chemical weapon attack was launched
Oil wasn’t the only price that changed amid world events on Thursday night.
S&P 500 futures dropped by 0.5 per cent and the yen jumped in value.
Japan’s currency is a favourite place for people to put their money because of the country’s status as the top creditor nation in the world.
- With files from Reuters
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