Oil prices surge over Middle East tensions

NEW YORK - Oil prices jumped over escalating Middle East tensions while stock markets wavered after getting a boost last week from talk of a US interest rate cut.

The price of Brent, the global crude benchmark, rose 3.0 percent to trade at more than $81 per barrel.

Stock markets were mixed, taking a breather after rising on Friday when US Federal Reserve chief Jerome Powell signaled that a rate cut was coming.

In a further sign of the Fed's thinking, another policymaker came out in support of a rate cut on Monday.

Tensions were still running high in the Middle East following Sunday's exchange of fire between Lebanon's Hezbollah and Israel.

Hezbollah said it had launched a large-scale drone and rocket attack on Israel. Israel said it conducted air strikes into Lebanon that destroyed "thousands" of rocket launchers and thwarted a major attack.

The oil market was also reacting to Libya's eastern-based administration declaring that it was shutting down oil fields under its control and "suspending all production and exports until further notice."

The move by the Benghazi-based administration, which controls most of the country's oil fields, comes amid rising tensions after the UN-recognised government based in Tripoli replaced the central bank governor on Monday morning.