The price of oil fell by about 4.5%, as Israel's retaliatory strike against Iran did not affect energy supplies and eased geopolitical tensions in the Middle East.
Last week, Brent and WTI rose in price by 4% amid uncertainty about Israel's retaliatory strike against Iran and the US elections.
Meanwhile, on Saturday, Israel carried out three waves of strikes on missile factories and other facilities near Tehran and in western Iran. Against this background, the geopolitical risk premium that was embedded in oil prices in anticipation of an Israeli retaliatory strike has come to naught. As a result, Citi analysts lowered the target price for Brent crude oil for the next three months from $74 to $70. However, many experts warn that if Iran decides to counterattack in the coming weeks, risk premiums could rise again.
The ceasefire talks between Israel and the Iranian-backed Hamas militant group, which resumed over the weekend, will also have an impact on prices.