Oil prices extended their decline on Tuesday since early this week in the Asian session, a day after Iran's missile attack on a US air base in Qatar caused no deaths.
It also raised investor hopes that there may be a way to de-escalate the conflict in the Middle East.
Benchmark West Texas Intermediate (WTI) oil fell 3.30% to $65.05 a barrel and Brent fell 2.87% to $67.07 a barrel in mid-day trading on Tuesday.
According to NBC News, Iran launched a missile attack on the Al-Udeid Air Base in Qatar in retaliation for the US attack on its most important nuclear site last weekend.
Qatar confirmed that the Iranian attack caused no injuries.
Crude oil prices surged on Sunday afternoon after the US joined Israel's campaign against Iran.
Brent rose more than 5% to break the $81 mark before easing and WTI hit its highest level since January before retreating.
The oil market plunge reflected investor confidence that the conflict would subside, following President Donald Trump's announcement of a ceasefire in the Middle East. He also thanked Iran for its early warning before the attack on the US base, which helped prevent loss of life.
In addition, the oil market has so far managed to avoid the worst-case scenario of Iran closing the Strait of Hormuz. By 2024, around 20 million barrels of crude oil per day, equivalent to 20% of global consumption.
