Iran denies attacks on Israel forcing oil prices drop below $90 per barrel

As Iran disputes Israeli missile strikes that were previously thought to have caused supply disruptions and market instability, oil prices have fallen below $90 per barrel on the international market today.

Contrary to rumours, an Iranian official confirmed to Reuters that there had not been a missile attack against Iran and that Iran’s air defence systems had activated the explosions that occurred in the Iranian city of Isfahan.

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, unverified claims that Israel had launched retaliatory strikes on Iran caused global markets to plummet and oil prices to briefly soar, supporting safer investments like gold.

Friday saw explosions in the central Iranian province of Isfahan, according to Iranian state media. US media also quoted authorities claiming that Israel had launched retaliation strikes against Iran’s bitter enemy.

“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.”