“It all depends on how the Israelis react now.”
Oil prices remain stable despite the escalating conflict in the Middle East. The financial market reaction is more focused on the prospects for rising prices, for example, for oil, which reduces the prospects for interest rates to fall in the coming months.
World oil prices traded slightly lower on Monday morning, despite the fact that over the weekend in the Middle East In the East, tensions were rising, Sky News reported.
According to LSEG data, in Asian trading, international benchmark Brent crude fell almost 0.4% to $90 per barrel, while oil futures in The US also fell in price.
Market experts said the moves reflected the fact that fears of an Iranian attack on Israel, culminating in a non-lethal drone and missile strike on Saturday, had already been addressed in the previous week.
Oil on Friday Brent rose to near six-month highs, Sky News said.
Overall, stock markets across Asia pulled back and the same was expected in Europe later on Monday morning as investors worried about how Israel may react to Iran's actions.
The FTSE 100 index fell about 0.5% in London at the opening bell, reducing the index's chances of hitting record levels this week.
Trade closed at 7,999 on Friday — just 12 points below its peak in February 2023.
Analysts note that increasing attention is being paid to what rising oil prices will mean for the global economy.
Brent crude is up 17% year to date, while US crude is up nearly 19%, and there is growing talk of prices well above $100 a barrel unless there are signs of tensions easing. .
Iran's seizure last week of a tanker that Tehran said was linked to Israel has only heightened concerns about the impact on trade.
The impact extends beyond oil to critical supplies of liquefied natural gas (LNG), other commodities and consumer goods, many of which have already been affected by shipping disruptions in the Red Sea due to attacks by Yemen's Houthi rebels. related to Iran.
Inflation data this week will show whether higher shipping costs have had any impact, Sky News said.
Additional costs could undermine financial market expectations for a decline interest rates, which is widely forecast for this summer following the significant slowdown in price growth seen at the end of the COVID pandemic and then following the outbreak of the conflict in Ukraine.
Commenting on Monday's oil price reaction to the Iran attack, Warren Patterson ING, head of commodities strategy, said: “The attack was largely assessed in the days leading up to it. In addition, the limited damage and the fact that there were no casualties means there may be a more measured Israeli response. But obviously there is still a lot of uncertainty, and it all depends on how Israel reacts now.»