Concern the Israeli-Hamas conflict may escalate has led to worries over volatility in global crude oil prices.
Days after Israel struck Gaza in response to attacks by militants, crude oil prices rose by 4% amid concerns price fluctuations will intensify, said Montri Rawanchaikul, chief executive of PTT Exploration and Production Plc (PTTEP).
If the conflict is not limited to Gaza and leads to an impact in other areas, petroleum production in the Middle East may be affected, he said.
National oil and gas conglomerate PTT Plc, the parent company of PTTEP, shared a similar view.
PTT chief executive Auttapol Rerkpiboon said global crude prices increased, then fell slightly to a level that is higher than before the conflict erupted.
These price movements are the result of the "psychological impact" of the war, said Mr Auttapol.
Last week, West Texas Intermediate reference crude oil prices were expected to average $80-87 per barrel, according to an estimate by Thai Oil Plc, the oil refinery arm of PTT.
In the second quarter of last year, global oil prices soared past $100 a barrel amid worries over oil supply disruption as a result of the Russia-Ukraine war.
PTT analysts viewed this as a market overreaction to the war.
One impact was electricity bills surged last year because of the sharp increase in liquefied natural gas (LNG) prices in the spot market as the war in Ukraine ballooned.
Thailand imported more LNG as the domestic supply of gas, which was cheaper, declined.
Gas makes up 60% of the fuel used to generate electricity in Thailand.
Mr Montri said he is concerned about the possible impact on LNG prices if Israel and Palestinian militants cannot solve their conflict through negotiations.
"Though we are an energy firm, we don't want to see energy prices rise considerably, which will affect people and businesses," he said.
Kriengkrai Thiennukul, chairman of the Federation of Thai Industries, said manufacturers need to carefully manage their energy expenses because higher oil prices will drive up costs of goods manufacturing.
Nutta Mahattana, assistant managing director for investment strategies at Krungthai Asset Management, said he expects the conflict to push oil prices to $150 per barrel.
"The war makes that oil price level a possibility," said Mr Nutta.
He noted a few days after Hamas militants invaded southern Israel the past weekend, oil premiums rose $3-4 barrel per day.
The Middle East produces one-third of the global crude oil supply, and prices rose more than 4% on Tuesday.
KEEPING A WATCHFUL EYE
Asia Plus Securities (ASPS) said the war must be monitored because it may extend across regions.
"The Israeli-Hamas war is intense, though it has not affected their allies yet," ASPS said in a research note.
"This is causing oil prices and safe asset prices to rise."
Western countries, such as the US, Europe and Canada, support Israel and condemn Hamas as a terrorist group. Hamas is allied with Arab countries, such as Syria and Lebanon, as well as Iran.
The war is not expected to become more violent, unlike the Russia-Ukraine war, according to ASPS.
Oil prices are projected to remain flat at $85-87 because Israel and Palestine are not major oil producers, said the brokerage.
"The war must be watched in case it extends across regions. The crude oil prices may fluctuate if the war escalates as the US, Canada and the Middle East are among the world's top 10 crude oil producers," said ASPS.
The war should not have a significant impact on the Thai economy, said the brokerage.