Global oil prices drop more than 3% as fears of supply disruptions ease

Global oil prices dropped more than 3 per cent as the surge driven by increasing geopolitical tensions paused, with the market anticipating a response from Israel against Iran.

Tamas Varga, an analyst at oil broker PVM, remarked in a Tuesday report, “Oil can only continue to rise for so long based on perceptions rather than actual disruptions in supply.”

Following Iran’s launch of approximately 180 ballistic missiles at Israel last week, oil prices had climbed nearly 13 per cent by Monday’s close, sparking concerns that Israel could retaliate by targeting Iran’s oil sector.

President Joe Biden has openly advised Israel against targeting Iran’s oil infrastructure. According to officials speaking to The New York Times, Israel is anticipated to prioritise strikes on military and intelligence sites in Iran.

Similarly, The Jerusalem Post has reported that Israel’s efforts will likely concentrate on these military and intelligence facilities.

Israeli Defense Minister Yoav Gallant is set to meet with US Secretary of Defense Lloyd Austin at the Pentagon on Wednesday to discuss ongoing security developments in the Middle East, as stated by press secretary Maj. Gen. Pat Ryder during a briefing on Monday.