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April 19, 2024

Oil prices drop below $90 per barrel as Iran denies attacks

Oil prices drop below $90 per barrel as Iran denies attacks

…Nigeria’s Bonny Light hovers at $89 per barrel

By Udeme Akpan, Energy Editor

Oil prices have dropped below $90 per barrel, today, in the global market as Iran denies suspected missile attacks by Israel, which previously fueled speculation over possible supply disruption and market instability.

Contrary to speculation, an Iranian official told Reuters that there was no missile strike carried out against Iran, adding that the explosions in the Iranian city of Isfahan were, due to the activation of air defense systems of Iran.

However, a source at the London oil market, said: “The market responded positively, pushing prices to more than $93 per barrel in the early hours today, because of speculation that the alleged attack on Iran could lead to shortage.”

Background

Earlier, there were reports that oil prices briefly surged and stock markets slid Friday as unconfirmed reports said Israel had carried out retaliatory strikes against Iran, boosting investments deemed safer such as gold.

Iran’s state media reported explosions in the central province of Isfahan on Friday, as US media quoted officials saying Israel had carried out retaliatory strikes against its arch-rival.

“Asian markets bore the brunt of the breaking news of a retaliatory attack on Iran by Israel, also sending Dow futures sharply lower and resulting in further spikes in gold and oil prices,” noted Richard Hunter, head of markets at Interactive Investor.

“US markets will not have the opportunity to react directly to the developments until later, but the escalation will put pressure on the main indices, which were already lining up for a weekly drop.”