On Tuesday (October 15th) in the Asian morning session, the price of US crude oil futures suddenly plummeted. This followed reports that Israel might avoid attacking Iran's oil infrastructure, alleviating concerns about tensions in the Middle East.
After falling by 2.3% on Monday, US WTI crude oil futures continued to decline, reaching a low of $71.39 per barrel. Brent crude oil futures also plummeted to $74.796 per barrel at one point.
The Washington Post, citing two informed officials, said that Israeli Prime Minister Benjamin Netanyahu told the Biden administration that he was willing to strike Iran's military facilities, rather than oil or nuclear facilities.
Rohan Reddy, Head of International Business Development and Corporate Strategy at Global X Management, said: "The current market reaction may be the temporary cancellation or reduction of the geopolitical risk premium for oil."
On Monday, US officials were quoted as saying that Washington sees this as a sign of Israel's restraint in retaliating against Iran's missile attacks. The US is concerned that if Israel attacks Iran's oil or nuclear facilities, it could trigger a larger-scale war.
According to Reuters in the UK, Netanyahu denied on Monday that the Israeli military deliberately attacked the military base of the United Nations Interim Force in Lebanon (UNIFIL), calling the allegations "completely wrong" and once again called for UNIFIL to withdraw from the war zone. However, UNIFIL once again stated that it would not withdraw.
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Netanyahu said that while the Israeli military was fighting Hezbollah militants in Lebanon, it made the utmost effort to avoid harming UNIFIL personnel. "But the best way to ensure the safety of UNIFIL personnel is for UNIFIL to listen to Israel's demands and temporarily stay away from danger."
In recent weeks, as the prospect of escalating conflicts in the Middle East has attracted the attention of traders, oil prices have been in a "roller coaster" state. Israel has vowed to make a significant retaliation against Iran's missile attack on October 1st.Due to geopolitical tensions threatening production in the Middle East, U.S. WTI oil prices have risen by about 5% so far this month. The region's oil supply accounts for approximately one-third of the global oil supply.
U.S. crude oil futures took a hit on Monday when the Organization of the Petroleum Exporting Countries (OPEC) lowered its crude oil demand forecast for 2024 for the third consecutive time, putting pressure on oil prices.
The futures price for West Texas Intermediate (WTI) crude oil for delivery in November at the New York Mercantile Exchange closed down $1.73 on Monday, a decrease of 2.29%, settling at $73.83 per barrel.
OPEC released a report on Monday, revising down the global crude oil demand growth for 2024 from an increase of 2 million barrels per day to an increase of 1.9 million barrels per day. This marks the third consecutive time the organization has downgraded its global crude oil demand expectations.