By Daniel Leussink

TOKYO (Reuters) - Almost half of Japanese companies see the conflict between Israel and Palestinian militants Hamas potentially hitting their earnings, citing concerns about a further rise in oil and commodity prices, the latest Reuters corporate survey showed.

On the issue of ending negative interest rates, which have been a key pillar of Japan's central bank's accommodative monetary policy, nearly half of Japanese firms said they expected it to happen by the middle of next year.

Forty-eight percent of firms polled by Reuters said the Israel-Hamas conflict would affect their earnings negatively, the poll showed, roughly on par with the 49% who expected no particular impact and outstripping the 3% who saw a positive effect.

"Worsening of the Middle East situation will lead to a sharp rise in raw material and fuel prices," a manager at a chemical manufacturer wrote in the survey.

In the survey, 46% of firms that responded to a question about how much oil prices are likely to rise in the near future said they expected them to increase to $120 a barrel or higher. North Sea Brent crude is now around $81 a barrel.

The poll highlighted wider worries about conditions in the Middle East. Among concerns about instability in the Middle East, two-thirds of respondents cited rises in raw material prices other than oil.

About half of them said they feared more global inflation, while two-fifths saw potential shortages of oil products and those made of them, according to the survey.

The monthly Reuters Corporate Survey of 502 large and mid-sized non-financial Japanese firms, in which 251 responded, showed 46% of companies expected the Bank of Japan (BOJ) to end negative interest rates by the June 2024 quarter or earlier.

The BOJ last week eased its hold on long-term rates by watering down a 1% cap set for the 10-year yield as a reference rather a rigid ceiling.

Sources have said its next focus is to end its negative interest rate policy and push short-term rates to zero, from the current -0.1%.

In the survey, 40% of firms said the negative interest rate policy was having a positive impact on their companies' management.

The survey was conducted for Reuters by Nikkei Research on Oct. 24-Nov. 2, with firms responding on condition of anonymity to allow them to speak more freely.