Brent crude, the global oil benchmark, was down 0.4% at $86.8 per barrel, having earlier spiked more than 3%.
The Israeli military has not commented, and Iran has not identified the source of the attack.
Iran launched the attack in retaliation for a suspected Israeli strike on its embassy compound in Syria earlier this month.
Iran is a big oil producer but exports most of its crude to China because of long-standing international sanctions.
Mexico also said earlier this month that it would cut back oil exports because of strong domestic demand.
Persons:
Brent, Israel, Benjamin Netanyahu, ”, ” Neil Shearing, Richard Bronze
Organizations:
London CNN, CNN, Capital Economics, Organization of, Petroleum, ANZ, United, Nikkei, Kospi, Tel Aviv Stock Exchange
Locations:
Hong Kong, London, Iranian, Isfahan, East, Iran, Syria, Hormuz, China, United States, Mexico, Asia, Israel, Tel Aviv