LONDON (Reuters) – Oil fell almost 2 percent on Monday after drilling activity in the United States rose and fears fade due to rising tensions in the Middle East following air strikes in Syria during weekend.
The United States, France and Great Britain launched 105 missiles on Saturday, pointing to what he said there were three chemical weapons facilities in Syria in retaliation for an alleged attack of poisonous gas on April 7.
The price of oil had risen almost 10 percent in the run-up to strikes, while investors accumulated assets, such as gold or US Treasury bonds. UU., Which can protect against geopolitical risks.
At 0851 GMT on Monday, Brent crude futures were down $ 1.34 to $ 71.24 a barrel, while US crude futures were down $ 1.16 to $ 66.23 a barrel.
"Regarding the events in Syria, the market has breathed a sigh of relief that there is no escalation, either diplomatically or on the ground, following the intervention of the United States, France and the United Kingdom. United, "said BNP Paribas global head of commodities market strategy, Harry Tchilinguirian.
"As a macro asset allocator, if you want to protect your portfolio against geopolitical risks, your main candidate is oil, especially if that risk is in the Middle East."
Although Syria is not a significant oil producer, the broader Middle East is the world's largest oil exporter and tension in the region tends to put oil markets on the edge.
"Investors continued to be concerned about the impact of a wider conflict in the Middle East," said ANZ Bank.
Fund managers have more options and Brent futures than at any time since records began in 2011, according to InterContinental Exchange data.
Investors have added to their bullish positions in Brent, which now equates to almost 640 million barrels of oil, in nine of the last 10 months, thanks in part to the premium of the previous month's futures contract over those of delivery at a later date, known as "backwardation".
Backwardation makes it profitable to maintain a bullish position in oil futures.
Apart from a flurry of profit taking after the air strikes, oil was also under some pressure due to another increase in drilling activity in the US. UU
U.S. energy companies added seven platforms in the week to April 13, bringing the total to 815, the highest since March 2015, and nearly 20 percent more than a year ago, service firm Baker Hughes said Friday.
Despite this, Brent is still up more than 16 percent from his 2018 low in February.
Additional report by Henning Gloystein and Roslan Khasawneh in Singapore; Editing by Edmund Blair