Oil Prices, Commodities Under Pressure After ISIS Attack

ISIS has recently launched a devastating attack on Paris, which led to multiple brutal deaths.

Gold and oil started at a modest rise on Monday in a jumpy early trading in Asia after the deadly assaults on Paris.  Overall, commodities markets seem to stay weak on poor fundamentals, as reported by CNBC. 

"Oil prices are likely to remain under pressure short-term," ANZ bank said in a morning note on Monday.

For most of the year, commodity markets have been facing a continuous pressure as high production by energy and mining companies' is met by slothful demand due to an economic depression in Asia, particularly in China but also Japan, which slipped back into recession in the third quarter.

Oil is already trading near its six-year lows and vigorous demand has been a major factor preventing the prices from further being low-graphed amid a worsening global oil surplus due to profuse supplies, as reported by Reuters.

"Currently sentiment is really bearish, so this could be seen as hurting demand, so oil prices could fall further," said Amrita Sen from Energy Aspects.

ActivTrades chief analyst Carlo Alberto de Casa and Ed Meir, an analyst at INTL FCStone, both said they expect a moderate rebound in gold prices given that equities and commodities were poised to be hit.

"People in France are in shock. They are not doing much shopping and that could last for a few days," said Olivier Jakob from Petromatrix consultancy.

"The rest of the world is not as deeply affected to change consumer behavior," said Jakob adding that the bearish impact of Paris attacks would likely be short-lived. The attack could, however, result in a re-calibration of France's foreign policy and positioning in the Middle East," he added.

As mentioned by Fxempire, following a series of coordinated ISIS attacks in the French capital, which caused the brutal death of at least 129 people on Friday evening. On Friday alone, US  traded oil at $40.74 a barrel, which has fallen back to its lows. Brent oil kept its track with WTI, which is unable to touch the figure of $44.47. 

According to analysts from Eurasia Group, due to recent ISIS attacks, the French government's ability to focus primarily on the improving economy will drastically suffer.

There seemed to be a little reaction in the oil markets as It is estimated that the terrorist organization is financed by its illegal exports of oil through Iran and Syrian.  Crude added 32 cents to 41.06 while Brent oil was up 49 cents at 44.96. The strength of the US dollar weighed on price as the greenback rallied 30 points to 99.19.

However, despite the aforesaid facts, the OPEC delegate, who was not named in the report, said that the reaction shown by the markets would depend on the severity and the length of any restrictions enforced across France and the rest of Europe.