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Crude oil prices dropped sharply late Monday afternoon after The Washington Post reported Israeli Prime Minister Benjamin Netanyahu told the Biden administration he is willing to strike military targets rather than oil or nuclear facilities in Iran.

The Details: Netanyahu told President Joe Biden in a call last Wednesday he is planning to target military infrastructure in a retaliatory strike against Iran, according to a U.S. official and an official familiar with the matter.

The sources also said Israel's action against Iran will be designed to avoid any perception of "political interference in the U.S. elections" noting an attack on Iranian oil facilities could send energy prices higher. The official familiar with the matter described Netanyahu as being in a "more moderated place" during the call between the two leaders.

What Else: The United States Oil Fund USO which tracks West Texas Intermediate (WTI) light crude fell 2.01% in Monday's regular trading session after OPEC lowered its 2024 global oil-demand growth forecast and its 2025 global oil-demand growth forecast.

In its Monthly Oil Market Report released on Monday, OPEC reduced its 2024 oil demand growth estimate by 106,000 barrels per day (bpd), now expecting global demand to increase by 1.93 million bpd next year. Additionally, the forecast for 2025 demand growth was lowered by 102,000 bpd to 1.6 million bpd year-over-year.

The ProShares Ultra Bloomberg Crude Oil UCO fund fell more than 2% in regular trading Monday following the lower global oil-demand growth forecast and is down another 4.51% at $27.50 after-hours.

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