Israel Latest: Over 1,100 Dead as Conflict Hits Oil and Shekel

The death toll from the conflict between Israel and the militant group Hamas topped 1,100 as fighting continued for a third day. Israel pointed the finger at Iran, which has denied playing a role in the attacks, while Western officials said they’ve not yet seen evidence that Iran was directly involved.

(Bloomberg) — The death toll from the conflict between Israel and the militant group Hamas topped 1,100 as fighting continued for a third day. Israel pointed the finger at Iran, which has denied playing a role in the attacks, while Western officials said they’ve not yet seen evidence that Iran was directly involved.

The operation by Hamas, which included taking scores of hostages, is Israel’s worst intelligence failure in 50 years. The US is sending war ships and weapons to the region, while Senate Majority Leader Chuck Schumer criticized China for not showing Israel enough support.

Hamas Attack Restores the Palestinian Question: Balance of Power

Oil jumped on fears of renewed instability in the Middle East, home to almost a third of global supply. The shekel dropped, even after the central bank unveiled an unprecedented $45 billion support program, while Israeli stocks dived. JPMorgan Chase & Co. asked its bankers in the country to work from home and a growing number of international airlines suspended flights to Israel.

All time stamps Israel.

EU Holds Emergency Meeting on Israel (1 pm)

European Union foreign affairs chief Josep Borrell is convening the bloc’s 27 foreign ministers for an emergency meeting on Tuesday. They will “address the situation in Israel and in the region,” according Borrell’s post on social media platform X.

Israel to Call up 300,000 Reserve Soldiers (12:40 pm)

Israel’s army plans to call up 300,000 reserve soldiers to fight, according to the Israel Defense Forces.

Israel Concern Grips Emerging Markets (12:30 pm)

The possibility of conflict with Iran surged to the top of emerging-market investors’ concerns as they returned from the weekend to assess the fallout of another conflict between Israel and Hamas.

The outbreak of war in the Middle East has momentarily replaced Federal Reserve policy and China’s growth as the most immediate concern. The risk-off move on Monday morning was largely confined to Middle Eastern stocks and crowded currency trades in Mexico and eastern Europe, though, with losses across wider emerging markets more muted.

JPMorgan Tells Israel Staff to Work From Home (12.20 pm)

JPMorgan has told its staff in Israel to work from home for the foreseeable future.

JPMorgan Tells Its 200 Staff in Israel to Work from Home

The Wall Street bank has about 200 employees in the country, a person with knowledge of the work-from-home plan said, asking not to be be identified discussing internal matters. A spokesman for the firm declined to comment.

Airlines Suspend Flights (12:15 pm)

A growing number of international airlines suspended flights to Israel, with US authorities advising carriers to monitor the situation before resuming operations. 

Airlines Suspend Flights After Israel Declares State of War

US carriers including Delta Air Lines Inc., United Airlines Holdings Inc and American Airlines Group Inc. canceled their service to Tel Aviv, as did European airlines such as Deutsche Lufthansa AG and Air France-KLM, alongside budget specialist Wizz Air Holdings Plc from Hungary.

Citi Says Conflict in Israel to Come as ‘Stagflationary’ (12:06 pm)

Israel’s economic activity will be likely disrupted, presenting a negative supply shock, according to Citigroup strategists including Michel Nies.

“A wide-scale call up of reservists could further reduce labor supply in an already tight labor market,” they say. “At the same time, fiscal support would probably have to be stepped up, both for reconstruction and loss of income support as well as for strengthening security measures.”

Citi Says Conflict in Israel to Come as ‘Stagflationary Shock’

Citigroup doesn’t expect “further sustained bouts of shekel” weakness after the Bank of Israel announced plans to sell $30b in FX and offer $15b in swap mechanisms.

Germany Mulls Cutting Aid to Palestinians (12:05 pm)

Germany may cut the amount of aid it provides to the Palestinians as a result of the Hamas attacks, according to a person familiar with the discussion, who asked not to be identified.

Development Minister Svenja Schulze said in a statement Sunday that the government in Berlin is reassessing its entire aid program following the “terrible turning point” marked by the weekend’s events and is coordinating with international allies. Germany has currently committed about 250 million euros ($263 million) in development aid toward projects like water supply, waste disposal and healthcare but does not directly finance the Palestinian Authority, Schulze’s ministry said.

Xi to Meet Schumer, US Senators (12 pm)

Chinese President Xi Jinping will meet with a delegation of US senators in Beijing on Monday, according to state broadcaster CCTV.

Senate Majority Leader Chuck Schumer earlier in the day criticized Beijing’s response to Hamas’ incursion into Israel.

“I was very disappointed, to be honest, by the foreign ministry’s statement that showed no sympathy or support for Israel during these tough, troubled times,” Schumer said during a meeting with China’s top diplomat in Beijing on Monday. “I urge you and the Chinese people to stand with the Israeli people and condemn these cowardly and vicious attacks.”

Iran Says It Wasn’t Involved (11:15 am)

Iran rejected claims it was involved in Hamas attacks, the semi-official Iranian Students’ News Agency reported, citing Ali Karimi-Maqam, a member of Tehran’s delegation to the United Nations.

“We stand at Palestine’s side in firm support out of sympathy,” he said. “But we have no role in Palestine’s response, because it is done purely by Palestine itself.”

Shekel, Israeli Bonds Slide (10:58 am)

The shekel and Israel’s government bonds bore the brunt of the market impact from the attack by Hamas over the weekend, with scattered impact on emerging-market assets globally.

The shekel slid as much as 2%, only briefly paring the losses as the central bank stepped in to supply dollar liquidity. Israel’s and Lebanon’s dollar bonds declined the most among emerging markets, with Israel’s 2120 “century bond” dropping to a record low. Israel’s stocks gained after after posting their worst drop since March 2020 on Sunday.

Iran Warns of ‘Destructive Response’ (10:39 am)

“Any foolish move against Iran will be met by Iran’s destructive response,” Iranian Foreign Ministry Spokesman Nasser Kanaani says in press conference when asked to respond to “threats” from unspecified Israeli officials and US senators. Palestinians have legitimate right to push back Israeli attacks and occupation, he said.

US Embassy in Lebanon Tells Citizens to ‘Exercise Caution’ (9:24 am)

The US embassy in Beirut instructed its citizens through the region to exercise caution as “situation in Israel continues to be unpredictable,” it said on its account on X, formerly known as Twitter.

Israel Fighting More Incursions From Gaza (9 am)

Hundreds of Hamas militants are still trying to infiltrate southern Israel through breaches in the security fence, the Israeli army said.

Hostage situations inside Israel are continuing, in particular in one community, Israel Defense Forces spokesman Doron Spielman told Bloomberg Radio.

The reported Iranian role in plotting Saturday’s attacks is consistent with Iran’s funding for Palestinian militant groups and contacts between them, according to the IDF spokesman. “You can connect the dots,” he said.

More Than 123,500 Displaced in Gaza, UN Says (9:00 am)

A total of 123,538 Palestinians have been displaced in Gaza due to the violence, according to the United Nations Office for the Coordination of Humanitarian Affairs.

The UN estimates about 73,500 of that number are sheltering in schools, some of them designated emergency shelters. Airstrikes and shelling by Israeli forces have targeted houses and apartment buildings, OCHA said in an update. Four large residential towers in Gaza city were completely destroyed, with no fatalities reported from the incidents, it said.

The agency also reported six health-care workers were killed in strikes that also damaged seven health-care facilities.

Iran Congratulates Hamas on ‘Victory’ (8:41 am)

Iranian President Ebrahim Raisi issued a message congratulating Hamas on its “victory.”

He called the attack “the manifestation of resistance against the flimsy zionist regime” in comments to the Iranian cabinet published by the government account on X.

Israel Still Fighting in ‘Volatile’ South (8:30 am)

The situation in the south of Israel remains volatile, Lieutenant Colonel Richard Hecht, an Israeli military spokesman, said Monday. Israeli forces have hit more than 1,000 targets in Gaza, including rocket launching sites, and four combat divisions have been mobilized. 

“We are still fighting,” he said. “There are seven to eight places near Gaza where we have warriors fighting terrorists. It is taking us more time than we expected.” Israeli forces have killed hundreds of Hamas fighters in Israel and Gaza, but the presence of hostages and missing civilians has forced the engagements to be more surgical and slower, he said. 

He said the arrival of the US fleet was not aimed at events in Gaza but at the risk of anti-Israel forces elsewhere, such as in Lebanon and Syria, from joining in.

UAE Warns On Regional Risks (8:15 am)

The United Arab Emirates called for de-escalation of the violence and stressed the need for an international diplomatic effort to “prevent a wider regional confrontation” that risks wider instability and spillover, including the involvement by other groups.”

The UAE’s ministry of foreign affairs also stressed the need to continue with regional peace efforts. It called on the Palestinians and Israelis to return to negotiations for a final settlement within the parameters of the two state solution, according to a statement posted online.

At Least Four Americans Killed: Schumer (6:25 am)

At least four Americans have been killed in the Israel-Hamas conflict, Senate Majority Leader Chuck Schumer said in a statement following an unclassified briefing.

“Sadly, we know the toll will rise,” he said, adding that the US was keeping all pressure on Iran and their proxies to ensure the situation does not turn into a regional conflagration.

China Calls for Ceasefire (6:17 am)

China called for an “immediate ceasefire” and reiterated support for an independent Palestinian state.

“The recurrence of the conflict shows once again that the protracted standstill of the peace process cannot go on,” a Chinese foreign ministry spokesperson said in a statement Sunday. It repeated Beijing’s support for a “two-state solution.”

Oil Soars on Middle East Tensions (4:08 am)

Oil initially rose 5% as Hamas’ surprise attacks on Israel threatened to inflame tensions in the Middle East, home to almost a third of global supply.

West Texas Intermediate traded near $87 a barrel as a war-risk premium returned to markets. 

The latest events in Israel don’t pose an immediate threat to oil supply, but there’s a risk the conflict could spiral into a more devastating proxy war, embroiling the US and Iran. Any retaliation against Tehran amid reports it was involved in the attacks could endanger the passage of vessels through the Strait of Hormuz, a vital conduit that Iran has previously threatened to close. 


–With assistance from Galit Altstein, Ethan Bronner, Alisa Odenheimer, Gwen Ackerman and Marissa Newman.

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