Oil prices eased slightly during Asian deals on Wednesday, trading below multi-month highs as the Iran-Israel conflict extended into a sixth day.
By 3:25 pm AEST (5:25 am GMT) Brent crude futures had slipped $0.20 or 0.3%, to $76.25 per barrel, while U.S. West Texas Intermediate (WTI) crude was down $0.06 or 0.1% to $74.78 a barrel.
This follows a 4% surge in the previous trading session.
The escalation in hostilities was marked by United States President Donald Trump’s call on Tuesday for Iran’s “unconditional surrender”, as air strikes between Israel and Iran continued.
The U.S. is reportedly reinforcing its military presence in the region, with three officials confirming the deployment of additional fighter aircraft to bolster regional forces.
ANZ analysts commented in a note to clients: “A third U.S. Navy destroyer entered the eastern Mediterranean Sea to help defend Israel, and a second U.S. carrier strike group is heading toward the Arabian Sea.
“So far, Iran’s crude exporting infrastructure has been spared amid the Israel attacks, with most of the fallout confined to the shipping industry."
The Middle East accounts for nearly a third of global crude production.
In addition to geopolitical developments, investors are also closely watching the second day of the U.S. Federal Reserve’s policy discussions, with markets broadly expecting the central bank to hold its benchmark interest rate steady in the 4.25% to 4.50% range.
