Despite Israel launching a new round of airstrikes on Iran over the weekend, market investors' concerns eased at the beginning of Monday as the targets of Israel's attacks did not include Iran's energy and nuclear facilities. This pushed crude oil prices to open significantly lower on Monday, and safe haven asset gold also fell back
Market data shows that both Brent and Brent crude oil fell by over 4% at the beginning of the day, with Brent crude oil plummeting to around $73 per barrel and WTI crude oil falling below $69 per barrel.
At the same time, spot gold prices also fell at the beginning of the Asian market on Monday, with the latest trading near $2734.
Israeli fighter jets attacked military targets in Iran last Saturday, fulfilling their pledge to retaliate against Iran's missile attack earlier this month, but the attack was clearly more restrained than many had expected.
On the early morning of October 26th local time, the Iranian capital Tehran suddenly heard the sound of explosions. Israeli military spokesperson Daniel Hagari subsequently reported that on the 26th, Israeli Air Force fighter jets accurately struck military targets such as Iran's missile manufacturing facilities and safely returned to Israel after completing the mission.
It is reported that Israel carried out three waves of airstrikes on the same day, lasting about four hours, deploying over a hundred different types of fighter jets including F-35. The first wave of Israeli military attacks targeted Iran's air defense systems, while the second and third waves focused on Iran's missile and drone bases and production bases. Two Israeli officials anonymously revealed that the targets of the attack did not include nuclear or oil facilities.
After the Iranian missile attack on Israel earlier this month, the international community has been in a relatively tense state, fearing further escalation of regional conflicts. Iran's nuclear and oil facilities were once seen as potential targets for Israel's retaliation. However, in the end, Israel did not rashly attack these sensitive targets this time.
According to reports from Iran, Israeli fighter jets "violated international law" on the morning of the 26th by launching long-range air based missiles at radars in Iran's Iram and Khuzestan provinces, as well as near the capital Tehran. Due to the timely response of Iran's air defense system, the Iranian side suffered "limited losses and minimal impact", with only multiple radar systems damaged, but four soldiers killed in the attack.
Iran has also exercised relative restraint in its verbal response this time. On the 26th, the General Staff of the Iranian Armed Forces stated that Iran has the "right" to respond to the Israeli military's airstrikes on Iran earlier that day, but Iran "prioritizes reaching a lasting ceasefire in the Gaza Strip and Lebanon".
As the situation in the Middle East may enter a period of easing after the Israeli attack, the significant drop in oil prices at the beginning of the day is not surprising. Some analysts say that the geopolitical risk premium formed in oil prices has gradually disappeared due to the expectation of Israel launching retaliatory attacks.
Saul Kavonic, an energy analyst at MST Marquee, said that the intensity of the attack was essentially limited, including avoiding oil infrastructure, which gave hope for ways to ease hostilities in the Middle East, especially if Iran did not retaliate in the coming days.
Israel's attacks have avoided striking energy infrastructure and are limited in scope. Limited attacks may quell concerns of direct conflict with Iran, "Infrastructure Capital Advisors CEO Jay Hatfield also said in a report on Sunday. With the arrival of winter heating and tourism season, we expect oil prices to rebound to our estimated reasonable price range of $75-95
However, Phil Flynn, Senior Market Analyst at Price Futures Group, still warns that concerns about oil supply in the Persian Gulf region are not yet over.
The bottom line of the oil market is that the direct threat of supply disruption is temporarily put on hold. From a larger perspective, if you think this attack will end hostilities, I don't think so... Even if Iran says it won't respond, I think Iran will try to get their representatives to regroup and respond in some way, "he said in a report on Sunday.