Oil prices continued their decline on Tuesday after Israeli Prime Minister Benjamin Netanyahu assured US President Joe Biden that Iran’s oil and nuclear facilities would not be targeted in response to a missile attack earlier this month.
The sell-off also reflected concerns over China’s economic outlook after Beijing’s weekend briefing failed to announce any new stimulus.
Hong Kong and Shanghai stocks saw another dip as investors were disappointed by a lack of concrete details in economic measures released last week, despite hopes for more robust support for China’s economy.
Oil prices dropped by about three percent in early trading, following Monday’s two percent dip, after reports from the Washington Post indicated Netanyahu would focus on military targets rather than Iran’s crude or nuclear sectors.
Investor tensions have been high since Tehran launched a missile barrage at Israel earlier this month, raising fears of a regional conflict. The commodity market has been volatile, especially as Israel battles Hezbollah militants in Lebanon and Hamas in Gaza.
Meanwhile, China’s failure to deliver expected fiscal support has added downward pressure on oil prices, with concerns mounting over the country’s ability to revitalize its economy. Although weak trade and inflation data pointed to the need for intervention, analysts suggest that further details may only emerge during an upcoming Communist Party meeting. Key economic figures, including retail sales and economic growth, are expected later this week.
