Israeli stocks jumped the most since December after energy companies raised estimates for reserves at the Leviathan gas field by 15%, even as the conflict between Israel and militants in the Gaza Strip intensified.
Shares rallied as investors speculated fighting between Israel and militants in the Hamas-controlled Gaza Strip will have limited impact on the economy.
Leviathan’s offshore resources are as much as 21.94trillion cubic feet, up from 19trillion cubic feet, Delek Drilling and Avner said in a stock exchange filing on Sunday, citing petroleum consultants Netherland, Sewell & Associates.
This is the second time the field’s reserves’ estimates have been raised, following an increase of 18% in May 2013.
The value of the field is now estimated to be worth between $2.9billion to $4.4billion more than previously estimated.
Israel expects the giant Leviathan field, discovered in 2010 and due to start production in 2017, to meet its gas needs for 25 years, while bolstering export earnings.
“The gas drillers are helping to lift the market after Leviathan reserves were updated,” said Saar Golan, a trader at Meitav DS Investment House in Bnei Brak, Israel.
“Since Wednesday, there hasn’t been much of a change in the geopolitical situation, and the market has already priced in the current conflict, but not yet pricing in a ground operation.
“Based on past operations, the market estimates the economic damage to be limited.”
Thousands of Palestinians fled to United Nations facilities in the Gaza Strip seeking sanctuary after Israel warned them to leave their homes before stepped-up strikes against rocket squads.
As trucks carrying tanks traveled south to the Gaza border, Israel edged closer to its first ground assault on the territory since 2009.
After five days of Israeli bombing, the Palestinian death toll was at least 165.