Crude declined after Israeli strikes on Iran avoided oil facilities. The yen fell after Japan’s ruling coalition failed to win a majority in parliament, stoking speculation the political uncertainty would make the central bank less hawkish.
Oil tumbled more than 5% at one point and gold also edged lower after Iran said its oil industry was operating normally following Israel’s attacks on military targets across the country in retaliation for a missile barrage earlier this month.
“The measured and targeted response from Israel has increased hopes of de-escalation,” Warren Patterson, head of commodities strategy at ING in Singapore, wrote in note. “If we do see some de-escalation it would allow fundamentals once again to dictate price direction.”
In currency markets, the yen was in the spotlight with a drop to its weakest level in about three months against the dollar, after a gamble by Prime Minister Shigeru Ishiba to call a snap election backfired.
