Brent crude futures fell 43 cents, or 0.5 percent, to $77.62 per barrel by around 0015 GMT. U.S. West Texas Intermediate crude futures slipped 35 cents, or 0.5 percent, to $74.03 per barrel.
Last week, the Brent contract gained over 8 percent, the most in a week since January 2023, while the WTI contract gained 9.1 percent week-on-week, the most since March 2023.
Israel bombed Hezbollah targets in Lebanon and the Gaza Strip on Sunday ahead of the first anniversary of Hamas’ Oct. 7 attacks on Israel that triggered war. Its defence minister also said all options were open for retaliation against Iran.
That came after Iran launched a missile attack on Israel last week in response to Israel’s operations in Lebanon and Gaza.
Meanwhile, Israeli police said early on Monday that Hezbollah rockets had hit Israel’s third-largest city of Haifa.
OPEC and its allies, including Russia and Kazakhstan, have millions of barrels of spare capacity, as it has been cutting production in recent years to support prices amid weak global demand.
The producer group has enough spare oil capacity to compensate for a full loss of Iranian supply if Israel knocks out that country’s facilities, but it would struggle if Iran retaliates by hitting installations of its Gulf neighbours.
At their last meeting on Oct. 2, OPEC and its allies, or OPEC+, kept their oil output policy unchanged, including a plan to start raising production in December.
