FX.co ★ Oil Halts Rally

Brent crude oil futures settled around $74 per barrel on Monday, easing back from a previous surge of over 5.5%, which followed a 7% increase on Friday. This pullback occurred as investors reassessed their risk-aversion strategies amid indications that the Israel-Iran tensions might not intensify. Market participants now speculate that the conflict is likely to remain confined, especially since Iran’s oil infrastructure has not been affected. Nevertheless, renewed military actions by both nations over the weekend have kept investors vigilant, prompting concerns about broader instability in the region. A significant worry is the potential threat to the Strait of Hormuz, a vital passageway through which approximately 18–19 million barrels of oil, equating to about 20% of global consumption, are transported daily. Although direct impacts on supply have been limited thus far, geopolitical risks continue to be substantial. In the meantime, Iran called off nuclear discussions with the United States that were planned for Sunday in Oman.