Oil Prices Dip After Iran’s Attack on Israel: Market Impact and Analysis

(CTN News) – Oil prices dipped in early Asian trade after Iran launched a retaliatory attack on Israel over the weekend.

Brent crude, a crucial benchmark for international oil prices, fell but remained close to $90 per barrel on Monday morning.

Prices had already climbed ahead of Iran’s decision, with Brent crude approaching a six-month high last week.

According to Israeli Defense Minister Yoav Gallant, the conflict with Iran is “not over yet”.

Energy expert Vandana Hari stated, “Clearly, the oil market does not see the need to factor in any additional supply threat at this point.”

Brent crude may fall below $90, but a further drop is unlikely as traders remain focused on the dangers linked with the wars in Gaza and Ukraine, she said.

Analysts also believe Israel’s reaction to the strike will be critical to global markets in the coming days and weeks.

Peter McGuire of trading platform XM.com told the BBC that he expected the energy market to be unpredictable and that oil prices would rise if Israel responded firmly to Iran’s moves.

Asian stock markets fell on Monday as investors assessed the strike’s impact.

The Hang Seng in Hong Kong, Japan’s Nikkei 225, and the Kospi in South Korea fell, while China’s Shanghai Stock Exchange Composite rose more than 1%.

The price of gold climbed upward, hovering near record highs at around $2,400 per ounce.

Gold is traditionally regarded as a safe investment during times of uncertainty, and it soared sharply ahead of the weekend.

Iran launched drones and missiles at Israel over the weekend, promising vengeance for an attack on its consulate in the Syrian capital, Damascus, on April 1.

Israel has not claimed responsibility for the consulate strike, but it is largely assumed to be the culprit.

Brent crude reached $92.18 a barrel at the end of last week, its highest level since October, before sliding down to $90.45.

According to the US Energy Information Administration, Iran is the world’s seventh-largest oil producer and the third-largest member of the OPEC cartel.

According to analysts, a crucial problem for future oil prices is whether shipping via the Strait of Hormuz would be disrupted.

The Strait of Hormuz, which connects Oman and Iran, is an important shipping route since it transports over 20% of the world’s oil supply.

Opec members Saudi Arabia, Iran, the UAE, Kuwait, and Iraq export most of their oil across the Strait.

On Saturday, Iran captured a commercial ship with ties to Israel while passing through the Strait of Hormuz.