Oil prices fall as traders watch Israel-Iran conflict

Crude oil futures fell more than 1% on Thursday, after spiking sharply in the previous session on fears that Israel and Iran are on the brink of war.

U.S. West Texas Intermediate was down $1.02, or 1.5%, to $67.13 a barrel by 8:46 a.m. ET. Global benchmark Brent fell 99 cents, or 1.42%, to $68.78 per barrel.

Oil prices jumped more than 4% on Wednesday as fears of a conflict that would disrupt crude supplies suddenly swept the market.

Israel is considering taking military action against Iran without U.S. support in the coming days, five people with knowledge of the situation told NBC News.

The U.S. State Department, meanwhile, has ordered the departure of non-essential personnel from Iraq. The Pentagon authorized the voluntary departure of military members’ families from the Middle East.

The departures come after Iran’s defense minister warned that the Islamic Republic would strike U.S. bases across the region if a conflict breaks out.

Oil prices could spike to $120 per barrel or more if Iran closes the Strait of Hormuz in response to an Israeli strike, said Natasha Kaneva, head of global commodities research at JP Morgan.

Some 30% of the world’s seaborne oil trade moves through the strait, according to JP Morgan. But the risk of an Iranian blockade is low, Kaneva told clients a Thursday note.

“Crucially, for all of recorded history, despite many threats, the Strait of Hormuz has never been closed off. Crude oil continued to flow,” she said.

This is a developing story. Please check back for updates.