Global oil prices have erased nearly all of their recent war premium, falling below $80 per barrel less than two days after Israeli Prime Minister Benjamin Netanyahu left the Middle East.
Oil was trading near $100 per barrel on Saturday, but prices have since plunged below $80 and Brent also extended losses after Netanyahu left the region to meet Donald Trump in Washington DC.
The timing has drawn market attention as investors shifted from fears of supply disruptions toward hopes of de-escalation.
Oil prices last week surged toward $100 as traders priced in risks of further bombing in the region affecting key energy routes and Middle Eastern crude supplies.
Expectations of diplomatic engagement, including reports of US-Iran talks and reduced fears of immediate escalation, triggered a rapid decline in crude prices.
From $100 to Below $80 in Days
The oil market’s sudden reversal shows how quickly geopolitical risk premiums can disappear. Earlier concerns over possible disruptions to Middle Eastern oil flows pushed prices above $100, but trade levels eased after Netanyahu left the region. Traders decided to unwind their bets.
The decline also offers relief for oil-importing countries, including Pakistan, where international crude prices now directly influence local fuel prices on a daily basis.
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