Oil prices were volatile on Monday, after surging seven per cent on Friday, as renewed strikes by Israel and Iran over the weekend increased concerns that the war could widen across the region and significantly disrupt oil exports from the Middle East.
Brent crude futures rose 64 cents, to $74.87 a barrel in early trading, while U.S. West Texas Intermediate crude futures gained 76 cents, to $73.74.
They had surged more than $4 a barrel earlier in the session and also fell into negative territory briefly.
Crucially, investors seem to be assuming Iran will not threaten to close the Strait of Hormuz since that would risk dragging the United States into the conflict.
There's also plenty of scope for Saudi Arabia and the rest of OPEC to expand supply if needed to keep prices restrained.
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