Chevron Corp. CEO Michael Wirth told CNBC Tuesday the oil markets remain well supplied despite the recent escalation of tensions.
The Japanese yen, where investors traditionally take refuge in times of uncertainty, was also up, adding fuel to the fire in Tokyo, where the Nikkei 225 index plunged more than 2.5 percent in early trade.
In other markets, United States stock futures and Asian equities pared earlier declines, while Brent crude first rose more than 5%, then traded 1.3% higher.
"Our initial conclusion is that the risk of an imminent regional war has diminished after these attacks".
Tokyo's stock market benchmark fell almost 2% before recovering some of its losses and Hong Kong' was off 1%. In the global market, the price of gold crossed $1,600 an ounce on Wednesday which is a seven-year high. Spot prices rose 2.4 percent, according to the refinitive, to $ 1,610.90 an ounce, reaching new seven-year highs in the process. Iran has called that attack an "act of war" and "state terrorism" and had vowed a response.
The price of gold futures expiring in February are up 1.8% to $1,578.70 an ounce in NY on Monday, according to The Wall Street Journal, which is its highest price since April 2013.
However, these are prices of Gold futures.
Benchmark 10-year notes US10YT=RR last fell 9/32 in price to yield 1.8545%.
A report showing a surprise build in USA stockpiles helped crude prices to fall.
Brent LCOc1 futures fell $2.49 to $65.78 a barrel and U.S. WTI crude CLc1 declined $2.89 to $59.81 a barrel.
Among other precious metals, palladium hit a fresh all-time peak of Dollars 2,056.01 an ounce earlier in the session on sustained supply deficit, and was last down 0.3 per cent to USD 2,045.08.
Consultancy Eurasia Group said Iran probably would focus on USA military targets rather than energy targets. The dollar index, which measures the greenback against six major peers, was 0.19% lower at 96.819. The S&P 500 decreased 9.10 points, or 0.28 percent, to 3,237.18.
The energy minister of the United Arab Emirates said Wednesday that OPEC is ready to respond as tensions rise in the Middle East, saying that no country can afford a return to a situation where crude oil costs $100 per barrel.