- Oil turns lower with Israel-Iran attacks sparing flows so far
- The WTI prompt-month contract fell $1.50 to $71.48/Bbl Monday morning (7:45 AM CT)
- Over the weekend, Iran launched missile strikes against Israel in retaliation for Israeli attacks on nuclear and military sites
- Some missiles breached Israel’s Iron Dome and reportedly hit cities and energy infrastructure, including the Haifa refinery, which suffered partial damage but remains operational
- RBC Capital Markets noted that crude is increasingly “in the crosshairs,” raising risks to regional supply
- One potential target is Iran’s Kharg Island terminal, which handles about 90% of the country’s oil exports (~2 MMBbl/d)
- Iranian proxies could also target oil infrastructure in Iraq, OPEC’s second-largest producer
- The greatest concern for markets is a possible disruption of the Strait of Hormuz, a chokepoint for roughly 20% of global oil flows
- Iran, an OPEC member, currently produces around 3.3 MMBbl/d
- Diplomatic efforts to de-escalate appear limited, President Trump said Sunday he hopes for a ceasefire but acknowledged that “sometimes countries have to fight it out”
- Iran reportedly told mediators Qatar and Oman it won’t consider talks under ongoing Israeli attacks
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