U.S. crude oil sold off more than 6% on Monday, for its worst day in more than two years after Iranian energy facilities were not damaged during Israeli strikes over the weekend.
U.S. West Texas Intermediate futures dropped 6.13% to close at $67.38 per barrel for its biggest daily loss since July 12, 2022, when the benchmark shed 7.93%. Futures for global crude benchmark Brent slid 6.09% to settle at $71.42 per barrel.
Israel on Saturday attacked Iran’s military installations in three provinces in response to Tehran launching ballistic missiles against Israel on Oct. 1.
Iranian news agency Tasnim reported that the attack, which the state-owned Islamic Republic News Agency said killed four soldiers, had inflicted “limited” damage. The strike steered clear of oil, nuclear, and civilian infrastructure locations. Iranian oil news network Shana said that Iran’s oil industry operation is “underway normally” with no disruptions.
For weeks, markets had braced themselves for an Israeli retaliation following the direct Iranian offensive against the Jewish state earlier this month. Broader Middle East tensions have continued to rise after the attack on Israel by Iran-backed Hamas on Oct. 7 of last year.
Oil markets’ key consideration had been a direct engagement between both parties, with concerns of an attack on Iranian oil facilities rising in recent weeks. Iran accounts for up to 4% of global oil supplies, according to the U.S. Energy Information Administration.