Singapore. Oil prices fell more than $3 a barrel in early Monday after Israel’s retaliatory attack on Iran over the weekend avoided Tehran’s nuclear and crude oil facilities and did not disrupt energy supplies, easing geopolitical tensions in the Middle East.
Both Brent and West Texas Intermediate (WTI) reached their lowest levels since October 1 at the opening. Brent stood at $72.88 a barrel, down $3.17, or 4.2 percent; while WTI fell $3.13, or 4.4 percent, to $68.65.
Last week, indices gained 4 percent as markets priced in uncertainty over the extent of Israel’s response to the Oct. 1 Iranian missile attack and next month’s U.S. elections.
Dozens of Israeli aircraft completed three waves of strikes on Saturday against missile factories and other sites near Tehran and in western Iran, in another exchange in the escalating conflict in the Middle East.
The geopolitical risk premium that had built up in oil prices in anticipation of Israel’s retaliatory strike has faded, analysts say.
Saul Kavonic, an energy analyst at MST Marquee, said the more limited nature of the attacks, which avoided oil infrastructure, has raised hopes that a path will open to de-escalate hostilities in the Middle East, especially if it becomes clear that Iran does not will counterattack in the coming days.
“But despite the ebb and flow of news about conflicts in the Middle East, the general trend remains one of escalation, and the chances of another round of attacks, causing a spike in oil prices, have never been higher.” been older,” he said.
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