Crude oil prices fall on reports Israel will not strike Iran supply facilities

Oil prices tumbled Tuesday on reports that Israeli Prime Minister Benjamin Netanyahu told US President Joe Biden he would not strike Iran's crude or nuclear facilities.

Crude prices were also pulled lower by worries about demand in China after Beijing did not announce new stimulus for its stuttering economy at a weekend briefing.

Major stock markets largely fell, with New York giving up gains from Monday when the market hit record highs.

Key US oil contract West Texas Intermediate dropped more than five per cent to below $70 a barrel at one stage but recovered to $70.58.

European benchmark Brent North Sea crude slipped by 4.1 per cent.

Iran's retaliatory missile attacks on Israel this month sent crude prices soaring on fears that further strikes in response would disrupt oil supplies.

But reports of the Israeli PM's assurances "alleviated some of that supply concern," said Matt Britzman, senior equity analyst at Hargreaves Lansdown.

"With the geopolitical risk-premium falling, prices are once again being led by the struggling demand picture," he added.

The International Energy Agency said global oil markets remain "adequately" supplied thanks to the end of a Libyan oil blockade, weaker demand and relatively modest output losses from hurricanes in the US Gulf Coast.

China woes

Adding to downward pressure is concern that China, the world's largest crude importer, is failing to reignite its ailing economy.

Investors have been left disappointed by the lack of detail from China Finance Minister Lan Fo'an over the scale of stimulus measures to jumpstart the world's second-largest economy.

"Everywhere you look, China is in desperate need of fiscal support, with very weak domestic demand alongside an economy facing deflationary pressures and softer global demand," said Rodrigo Catril, a senior strategist at National Australia Bank.

Those concerns weighed on the region's stock markets, with Hong Kong closing down nearly four per cent Tuesday and Shanghai shedding 2.5 per cent.

Wall Street tumbled to end Tuesday as well, with investors assessing earnings reports and chipmaker equities weakening -- the latter on demand concerns and news the United States may introduce export curbs.

Markets reacted mostly positively to financial results initially, including those of Goldman Sachs, whose third-quarter profit jumped almost 50 per cent.

But chipmakers struggled after reports that the Biden administration was considering a cap on exports of advanced AI chips to some countries.

Dutch tech giant ASML, which supplies chip-making machines to the semiconductor industry, also saw its shares dive in Europe and the United States after unveiling a cut to 2025 guidance and seeing a slump in sales bookings.

Chip titan Nvidia lost 4.5 per cent, while AMD was down 5.2 per cent.

"The selloff is because of ASML suggesting that demand is not as strong" as anticipated for chips and AI, said Quincy Krosby of LPL Financial.

London closed lower despite official data showing that Britain's unemployment and wage growth had eased, boosting analyst expectations that the Bank of England would resume interest rate cuts next month.

Paris stocks dropped but Frankfurt closed little-changed after a survey showed German investor confidence rose more than expected in October.

Get insights into Upcoming Cars In India, Electric Vehicles, Upcoming Bikes in India and cutting-edge technology transforming the automotive landscape.