NEW YORK: Oil prices fell by roughly 1% a barrel on Monday as worries of a rapidly escalating conflict that would replace crude barrels were allayed by the fact that Iran’s attack on Israel over the weekend turned out to be less devastating than expected.
By 1:17 p.m. EDT (1717 GMT), Brent futures for June delivery had dropped 91 cents to $89.54 per barrel, or 1%. US oil futures for delivery in May dropped 87 cents to $84.79 a barrel, or 1%.
In advance of Iran’s counterattack, oil benchmarks saw a spike in prices on Friday, reaching their highest level since October.
Israel’s intercept of Iran’s onslaught, which included over 300 missiles and drones, allayed concerns that a regional war would disrupt Middle Eastern oil transportation. “The Israeli defense’s success suggests that geopolitical risk has significantly decreased,” stated Bob Yawger, Mizuho Bank’s director of oil futures.
Yawger continued, “Strong US retail sales data from the Commerce Department also hurt oil prices by raising the possibility that interest rates in the largest economy in the world would stay higher for longer and decrease demand for oil.”
