Oil rates drop over USD3 per barrel as Iran downplays Israeli strikes
Date
10/28/2024 9:40:48 AM
(MENAFN) Oil prices experienced a significant drop of over USD3 per barrel on Monday, following Israel's recent retaliatory airstrikes against Iran that did not target Tehran's oil and nuclear facilities. This development eased some of the geopolitical tensions in the Middle East that had previously impacted energy markets. Both brent and US West Texas Intermediate (WTI) crude futures hit their lowest levels since October 1 at the market open. As of 8:14 a.m. Saudi time, Brent crude was priced at USD72.59 per barrel, reflecting a decrease of USD3.46 or 4.6 percent, while WTI fell by USD3.37 or 4.7 percent, settling at USD68.41 per barrel.
In the previous week, both benchmarks had gained approximately 4 percent amid volatile trading conditions, largely due to uncertainty surrounding Israel’s response to an Iranian missile attack on October 1 and the upcoming US elections next month. The Israeli military conducted three waves of strikes early Saturday morning, targeting missile factories and other sites in western Iran. This latest escalation between the two Middle Eastern adversaries raised concerns over potential disruptions to oil supplies.
Analysts noted that the geopolitical risk premium, which had driven oil prices higher in anticipation of Israel's military response, has begun to recede. Saul Kavonic, an energy analyst at MST Marquee in Sydney, remarked that the relatively restrained nature of the strikes—particularly their avoidance of oil infrastructure—has sparked optimism for a potential de-escalation in the conflict. This sentiment contributed to a decrease of a few dollars in the risk premium associated with oil prices.
Market participants will be closely monitoring the situation for any signs that Iran might retaliate in the coming weeks, as such developments could lead to a resurgence in the risk premium. The dynamic between these geopolitical tensions and oil prices remains a critical factor for traders and analysts alike, who are keeping a vigilant eye on developments in the region.
MENAFN28102024000045015839ID1108824988
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.