## Iran Attacks Israel, Oil Prices Fall
Oil prices fell on Monday following Iran's attack on Israel early Sunday. Despite the Israeli government's claim of limited damage, tensions have escalated in the region, prompting market participants to reduce risk premiums.
Brent futures for June delivery fell 20 cents or 0.2%, to $90.25 a barrel, while West Texas Intermediate (WTI) futures for May delivery were down 33 cents or 0.4%, at $85.33 a barrel by 0225 GMT.
The attack has also impacted Asian markets, with shares slumping and gold prices rising as risk sentiment takes a hit. The dollar reached a fresh 34-year high against the yen, as fears of a wider regional conflict escalate.
Asian markets started the week cautiously, with MSCI's broadest index of Asia-Pacific shares outside Japan falling 0.7%. Key indices in India, Japan, and Australia also experienced declines.
The Israel-Iran conflict has pushed gold prices up 0.51% to $2,356.39.
Iran's attack, involving over 300 missiles and drones, was retaliation for an air strike on its Damascus consulate that resulted in the death of top Revolutionary Guards commanders. Israel's Iron Dome defense system, with assistance from the US, Britain, France, and Jordan, successfully intercepted the missiles and drones.
Israel, already engaged in conflict with Hamas militants in Gaza, has neither confirmed nor denied involvement in the Damascus consulate attack.
As the fourth-largest producer within OPEC, Iran produces over 3 million barrels per day (bpd) of crude oil. Oil sanctions and potential Israeli retaliation on Iran's energy infrastructure could lead to supply risks.
ING, in a client note on Monday, stated that if significant supply loss occurs, the US could release further crude oil from its strategic petroleum reserves. Additionally, OPEC has over 5 million bpd of spare production capacity.