### Oil Prices Plummet as Israel Vows to Spare Iranian Facilities, Impacting Energy Stocks and Boosting Travel Sector

Oil prices experienced a significant drop on Tuesday, falling over 5% during morning trading in New York. This decline came after Israeli Prime Minister Benjamin Netanyahu assured the Biden administration that Israel would not target Iranian oil infrastructure in any potential retaliatory actions, easing fears of major supply disruptions in the Middle East.

West Texas Intermediate (WTI) crude, the benchmark for U.S. oil prices, slid to $70 per barrel, marking its sharpest single-day drop in more than a year. This steep decline followed a report indicating Netanyahu's commitment to avoid strikes on Iran's oil and nuclear facilities. Analysts had previously warned that such strikes could surge crude prices by $20 per barrel, raising concerns of a broader energy crisis due to anticipated retaliatory actions by Tehran.

The market's reaction was immediate and profound. U.S. energy stocks saw a notable decline, with the Energy Select Sector SPDR Fund (XLE) dropping 2.8%, marking its worst performance since late April. Major players such as APA Corporation, Diamondback Energy Inc., and Valero Energy Corporation each saw declines of around 4%. The SPDR S&P Oil & Gas Exploration & Production ETF (XOP), which includes companies involved in upstream exploration and production, fell by 3.1%. Downstream, the VanEck Oil Services ETF (OIH) also dropped 3.6%, with Schlumberger N.V., Halliburton Company, and Transocean Ltd. experiencing significant losses.

Conversely, the travel sector saw a positive impact from the plummeting oil prices, as lower fuel costs buoyed airlines and cruise lines. Norwegian Cruise Line Holdings Ltd. surged 4.3%, while Carnival Corp. rose by 5.3%. Goldman Sachs raised its price target for Royal Caribbean Cruises Ltd. from $195 to $220, reflecting strong earnings expectations. In the airline industry, American Airlines Group Inc. led the gains with a 3.5% increase, followed by United Airlines Holdings Inc. and Southwest Airlines Co., which rose by 1.2% and 1.3%, respectively.

Overall, the assurance from Netanyahu significantly affected both the energy and travel sectors, illustrating the far-reaching consequences of geopolitical developments on global markets.