Oil prices have surged after the outbreak of military conflict in the Middle East following deadly attacks by Hamas from the Gaza Strip.

Brent crude, the international benchmark, has climbed by more than $3 a barrel, or more than 3.6pc, as Israel declared war amid attacks that claimed the lives of more than 700 Israelis. More than 400 people have died in Gaza.

Israel is not an oil producing nation but the outbreak of conflict threatens disruption to supplies.

Major oil producer Iran has denied it helped to plan Hamas’s deadly attack on Israel following reports that Iranian security forces were involved and gave the final go-ahead.

Stephen Innes of SPI Asset Management said: “Disruptions or escalations in the region can have far-reaching implications for energy markets, global supply chains, and geopolitical dynamics.”

Oil earlier gained as much as $4.18, or 4.9pc, to $88.76 a barrel.

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