Crude oil futures edged lower on Monday after Iran said it would not escalate the conflict with Israel.
The West Texas Intermediate contract for May fell 29 cents to settle at $82.85 a barrel, while June Brent futures fell 29 cents to settle at $87 a barrel. U.S. crude oil and Brent fell 3% last week. The two benchmarks are up nearly 16% and 13% this year, respectively.
Iranian Foreign Minister Hossein Amirabdollahian told NBC News the country does not plan to respond to Israel's retaliatory strike launched Friday.
"As long as there is no new adventurism by Israel against our interests, then we are not going to have any new reactions," Amirabdollahian said.
Traders have dismissed fears that tit-for-tat strikes between Iran and Israel will escalate into a war, with the market focus likely to shift back to supply and demand fundamentals this week.
"The market reaction to the rise of geopolitical temperature in the region was yet another example that it is only reasonable to expect a protracted oil price rally in case of blocking the Strait of Hormuz or if Saudi Arabia is directly drawn into the conflict," Tamas Varga, an analyst with oil broker PVM, told clients Monday.