HOUSTON: After Israel’s retaliatory strike against Iran’s military on Saturday avoided oil and nuclear sites and did not impair energy supply, oil prices fell by about $4 a barrel on Monday.
At 11:37 a.m. CDT (1637 a.m. GMT), Brent futures were down $4.20, or 5.52 percent, at $71.83 a barrel, while WTI US crude futures down $4.08, or 5.68 percent, to $67.70.
At the opening, Brent and US West Texas Intermediate crude futures fell to their lowest levels since October 1.
According to Phil Flynn, senior analyst at Price Futures Group, “this is obviously a perfect example of a headline-driven market.” “Geopolitical risk is still very high.”
In erratic trading last week, the benchmarks rose 4% as investors expressed apprehension about the impending US election and the magnitude of Israel’s anticipated reaction to the October 1 Iranian missile strike.
According to a note by analysts lead by Max Layton, Citi reduced its Brent price prediction for the next three months from $74 to $70 a barrel, accounting for a smaller risk premium in the short run.
Last month, the Organization of the Petroleum Exporting Countries (Opec+) and its allies maintained its oil output policy, which included a plan to begin increasing output in December. Prior to the full Opec+ meeting, the group will convene on December 1.
WTI may trade significantly lower in the upcoming year, according to Tudor, Pickering Holt analyst Matt Portillo.
