<p>Bengaluru: Iran's weekend attack on Israel has increased geopolitical risks in the oil market for the near term, prompting some banks to raise their price forecasts.</p><p>Iran fired over 300 drones and missiles at Israel late on Saturday in retaliation for a suspected Israeli attack on its consulate in Syria on April 1, a first direct attack on Israeli territory that has stoked fears of a wider Middle East war.</p>.After US, UK dismisses Iran's assertion of warning Israel before attack.<p>Citi on Monday raised its short-term oil forecasts to $88 per barrel from $80 on higher risk premium. However, Citi said it believes the current market is not currently pricing in a potential continuation of an all-out conflict between Iran and Israel that could push oil to $100 plus per barrel.</p><p>Any de-escalation could see prices falling back quite sharply to the high $70s or low $80s per barrel range, Citi added.</p><p>Two senior Israeli ministers have signalled that retaliation against Iran is not imminent and that Israel will not act alone.</p><p>Societe Generale said in a note that geopolitical risk is likely to become embedded in crude prices for the foreseeable future.</p><p>Socgen raised its Brent forecast to $91 per barrel in the second quarter and WTI to $87.5, and expects Brent to average $86.8 and WTI $83.3 in 2024.</p><p>"We still view direct U.S./Iran military action as a tail risk, its probability has increased from 5% to 15% with crude prices under such a scenario easily spiking above $140," Socgen added.</p><p>Meanwhile, Brent futures for June delivery fell 81 cents, or about 0.9%, to $89.64 a barrel by 1335 GMT while WTI futures for May delivery were down 69 cents, or about 0.8%, at $84.97. Oil benchmarks had risen on Friday in anticipation of Iran's retaliatory attack.</p><p>Britain, France, Germany and the European Union's foreign policy chief all joined Washington and United Nations Secretary-General Antonio Guterres in calling for restraint in the Iran-Israel conflict.</p><p>J.P. Morgan said in a note that the outlook for oil seems to hinge on any Israeli military response to the Iranian attack.</p><p>"Beyond the short-term spike induced by geopolitics, our base case for oil remains a $90 Brent through May," J.P. Morgan said.</p><p>Kpler analyst Viktor Katona said: "If we have an unpredicted supply disruption say, Libyan supply is cut or Russian port infrastructure is droned by Ukraine, (then) prices could definitely spiral out of control again, towards $100/bbl."</p><p>Earlier this month, a Ukrainian drone struck Russia's third-largest oil refinery. According to Reuters calculations, around 14% of Russia's refining capacity has been shut down by drone attacks with the war in Ukraine now in its third year. </p>
<p>Bengaluru: Iran's weekend attack on Israel has increased geopolitical risks in the oil market for the near term, prompting some banks to raise their price forecasts.</p><p>Iran fired over 300 drones and missiles at Israel late on Saturday in retaliation for a suspected Israeli attack on its consulate in Syria on April 1, a first direct attack on Israeli territory that has stoked fears of a wider Middle East war.</p>.After US, UK dismisses Iran's assertion of warning Israel before attack.<p>Citi on Monday raised its short-term oil forecasts to $88 per barrel from $80 on higher risk premium. However, Citi said it believes the current market is not currently pricing in a potential continuation of an all-out conflict between Iran and Israel that could push oil to $100 plus per barrel.</p><p>Any de-escalation could see prices falling back quite sharply to the high $70s or low $80s per barrel range, Citi added.</p><p>Two senior Israeli ministers have signalled that retaliation against Iran is not imminent and that Israel will not act alone.</p><p>Societe Generale said in a note that geopolitical risk is likely to become embedded in crude prices for the foreseeable future.</p><p>Socgen raised its Brent forecast to $91 per barrel in the second quarter and WTI to $87.5, and expects Brent to average $86.8 and WTI $83.3 in 2024.</p><p>"We still view direct U.S./Iran military action as a tail risk, its probability has increased from 5% to 15% with crude prices under such a scenario easily spiking above $140," Socgen added.</p><p>Meanwhile, Brent futures for June delivery fell 81 cents, or about 0.9%, to $89.64 a barrel by 1335 GMT while WTI futures for May delivery were down 69 cents, or about 0.8%, at $84.97. Oil benchmarks had risen on Friday in anticipation of Iran's retaliatory attack.</p><p>Britain, France, Germany and the European Union's foreign policy chief all joined Washington and United Nations Secretary-General Antonio Guterres in calling for restraint in the Iran-Israel conflict.</p><p>J.P. Morgan said in a note that the outlook for oil seems to hinge on any Israeli military response to the Iranian attack.</p><p>"Beyond the short-term spike induced by geopolitics, our base case for oil remains a $90 Brent through May," J.P. Morgan said.</p><p>Kpler analyst Viktor Katona said: "If we have an unpredicted supply disruption say, Libyan supply is cut or Russian port infrastructure is droned by Ukraine, (then) prices could definitely spiral out of control again, towards $100/bbl."</p><p>Earlier this month, a Ukrainian drone struck Russia's third-largest oil refinery. According to Reuters calculations, around 14% of Russia's refining capacity has been shut down by drone attacks with the war in Ukraine now in its third year. </p>