Oil prices shot higher in early trading on Monday after the US joined Israel's attacks on Iran, with 'bunker buster' bombs dropped on three nuclear facilities over the weekend.
Brent crude was up 1% at $78 a barrel, having momentarily topped $81 in the early hours, which was the highest since January.
The price of gold was little moved as was the dollar, and US government bonds.
"So overall a pretty muted response from markets so far," said strategists at Deutsche Bank.
The world is "holding its breath to see how Iran will respond", said market analyst Ipek Ozkardeskaya at Swissquote Bank.
Iran said that "all options" are on the table, she noted, including trade disruptions through the Strait of Hormuz, where 20% of global oil and gas flows transit.
"This could involve blocking the canal or attacking commercial ships, as the Houthis do. Another option could be striking nearby oil facilities – similar to the 2019 attack on Saudi Abqaiq that knocked out 7% of global oil supply.
"But many remain optimistic that Iran will avoid a full-blown retaliation and regional chaos, to prevent its own oil facilities from becoming targets and to avoid a widening conflict that could hurt China – its biggest oil customer," said Ozkardeskaya, noting that satellite images are reported to suggest that oil continues to still flow through the Strait.
Holger Schmieding, chief economist at Berenberg, said "oil prices may stay elevated amid the grave uncertainty about how the conflict will evolve and whether oil and gas exports from the Gulf region could still be impacted to a significant extent.
"But a protracted disruption of such energy flows seems unlikely. We continue to base our economic and financial forecasts on the assumption that energy prices will fall back close to their pre-conflict levels by autumn, and possibly before that."