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Oil prices tumbled on Monday by the most in three years as traders wagered that Iran\u2019s attack on a US base in Qatar was a \u201cde-escalatory\u201d gesture that will stave off a more serious assault on energy infrastructure.<\/p>\n
Brent crude, the international benchmark, finished Monday\u2019s trading day down 7.2 per cent at $71.48 a barrel, the biggest fall since August 2022. <\/p>\n
It marked a sharp turnaround from the start of the session, when Brent surged above $80 as traders responded to US strikes on Iran\u2019s nuclear facilities at the weekend. <\/p>\n
The swing lower came after Qatar said it repelled a missile barrage fired by Iran, which targeted the Al Udeid air base near Doha, where 10,000 US troops are stationed. <\/p>\n
Brent fell further to $69.23 as the new trading day began after US President Donald Trump said Iran had provided \u201cearly notice [of the attack], which made it possible for no lives to be lost, and nobody to be injured.\u201d<\/p>\n
Helima Croft, a former CIA analyst now at RBC Capital Markets, said: \u201cThe market is now clearly pricing in major de-escalation between the US and Iran.\u201d<\/p>\n
Croft added that traders were betting on a \u201crepeat of the January 2020 dynamics\u201d, when during Trump\u2019s first term as president, Tehran retaliated against the US\u2019s killing of its top military official by firing missiles at Iraqi bases hosting American troops. In that case, Tehran telegraphed the attack to Trump through back channels in advance. <\/p>\n
\u201cIran\u2019s decision to retaliate via a well telegraphed missile attack on US bases implies that they are less likely to weaponise oil,\u201d said Michael Alfaro, chief investment officer at Gallo Partners, a hedge fund focused on energy and industrials.<\/p>\n
Brent on Monday wiped out its gains since June 12, the market close just before Israel launched a surprise blitz against Iran\u2019s nuclear facilities, military officials and scientists. <\/p>\n
Some analysts had worried that Iran could either attack important Middle Eastern energy infrastructure or attempt to close the Strait of Hormuz, the channel for about a quarter of the world\u2019s seaborne oil trade, in response to the incursions by the US and Israel. However, the decline in the oil price suggests traders are now trimming bets on that outcome. <\/p>\n
\u201cOil markets have come to realise with a jolt that Iran has no interest in an uncontrolled conflagration. As in 2020, Tehran has calibrated a bare minimum response,\u201d said Bill Farren-Price, at the Oxford Institute for Energy Studies. <\/p>\n
Analysts also said the crude market was supported by plentiful supply, particularly after the Opec+ group of oil producers had repeatedly lifted its output targets in recent months.<\/p>\n
\u201cAnother reason for the lack of war premium is the flood of oil that is hitting the market just as the geopolitical headlines assault the tape,\u201d said Robert Yawger, commodity analyst at Mizuho Securities, an investment bank. <\/p>\n","protected":false},"excerpt":{"rendered":"
Unlock the White House Watch newsletter for free Your guide to what Trump\u2019s second term means for Washington, business and the world Oil prices tumbled on Monday by the most in three years as traders wagered that Iran\u2019s attack on a US base in Qatar was a \u201cde-escalatory\u201d gesture that will stave off a more<\/p>\n","protected":false},"author":1,"featured_media":9497,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[49],"tags":[1810,1812,84,1811,268,1809,1808],"class_list":{"0":"post-9496","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-bet","9":"tag-deescalation","10":"tag-iran","11":"tag-major","12":"tag-oil","13":"tag-traders","14":"tag-tumbles"},"_links":{"self":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/9496","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=9496"}],"version-history":[{"count":0,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/9496\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/media\/9497"}],"wp:attachment":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=9496"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=9496"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=9496"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}