The greatest risk the oil markets face is that Iran retaliates against Israel airstrikes by closing the Strait of Hormuz, which is critical to global energy shipments.

Oil prices fell and stocks climbed in early trading on Monday, indicating optimism among investors about the limits of economic fallout from the ongoing Israel-Iran conflict. The Dow Jones Industrial Average surged 415 points, or 1%, erasing much of the losses suffered on Friday as back-and-forth strikes broke out between the two countries.

Oil prices fell $1 per barrel on Monday in volatile trading after reports that Iran is seeking an end to hostilities with Israel, raising the possibility of a truce and easing fears of a disruption to crude supplies from the region.