London: Oil prices saw a sharp decline in early Asian trading on Monday as Israeli airstrikes over the weekend, which targeted military sites in Iran, avoided impacting the country’s oil facilities. This development has brought some relief to the market, which had anticipated a possible oil supply disruption from a broader conflict.

The price of North Sea Brent for December delivery dropped by 4.05 percent, settling at $72.97 per barrel. Meanwhile, West Texas Intermediate (WTI) experienced a similar drop, falling 4.19 percent to $68.77 per barrel.

The Israeli strikes reportedly targeted missile manufacturing sites and military facilities in several Iranian provinces. Market analysts, including Stephen Innes from SPI Asset Management, noted that the deliberate avoidance of Iranian energy infrastructure has allayed fears of a more intense, oil-focused conflict with Iran. Innes observed that Iran’s measured response, downplaying the attack's impact, indicates a mutual reluctance to escalate hostilities further.

This cautious approach has lowered oil's risk premium, with analysts suggesting prices may continue to decrease if the situation remains stable. Some experts have indicated that a further easing of tensions could see oil prices dip as low as $60 per barrel, especially as markets begin to focus on a potential supply surplus in 2025.