Oil falls around $4 a barrel after Israel shows restraint on Iran strikes By Reuters
Written by Florence Tan
SINGAPORE – Oil prices fell nearly $4 a barrel on Monday after Israel’s retaliatory strike on Iran over the weekend bypassed Tehran’s oil and nuclear infrastructure and did not disrupt electricity supplies, easing political tensions in the Middle East.
Futures fell $3.89, or 5.1%, to $72.16 a barrel by 2310 GMT, while US West Texas Intermediate crude was at $68.02 a barrel, down $3.76, or 5.2%.
Both contracts gained 4% last week in volatile trading as markets weighed in on uncertainty about the extent of Israel’s response to an Iranian missile attack on October 1 and the US election next month.
Dozens of Israeli warplanes completed three waves of strikes before dawn on Saturday against missile factories and other sites near Tehran and western Iran, in the latest twist in the escalating conflict between the Middle East rivals.
The geopolitical risk premium built into oil prices in anticipation of an Israeli retaliatory attack is declining, analysts say.
The limited nature of the strikes, including the avoidance of oil infrastructure, has raised hopes for a negative trajectory, said Saul Kavonic, energy analyst at MST Marquee.
