Comments by Iranian officials and US President Donald Trump eased tension substantially and pushed crude prices lower and lower in late European trading.
The strikes, launched in retaliation for the assassination of Iran's top general last Friday, sent Brent and WTI prices to multi-month peaks before profit-taking prevailed.
Iran said it had "concluded" its missile attacks for now, and observers remarked that they had seemed carefully calibrated to avoid US casualties.
Trump told a press conference: "Iran appears to be standing down, which is a good thing for all parties concerned and a very good thing for the world."
Iranian Foreign Minister Mohammad Javad Zarif had tweeted earlier that the country does "not seek escalation or war".
Analysts pointed out that oil traders had many sources at their disposal in any event.
"Sooner or later investors will realise that the plentiful non-OPEC supply will more than make up for any short-term disruptions in the Middle East," noted Forex.com market analyst Fawad Razaqzada.
SEB analyst Bjarne Schieldrop added that "not a single drop of oil supply has been lost due to the recent incidents and this is why the oil price has fallen back down again so quickly."
Global stock markets initially slid on investor concern of a broader conflict, but most were in positive territory as European trading wrapped up.
London stocks were the outlier, essentially unchanged on the day, while Frankfurt gained 0.7 percent and Paris was 0.3 percent higher.
Fears of escalation proved "to be short-lived as the US administration avoided an impulsive military response in the aftermath" of the Iranian strikes, noted analyst Bethel Loh at trading firm ThinkMarkets.
Safe haven assets had fared well initially, but after surging above $1,600 an ounce for the first time in six years, gold fell back to $1,557.80 which represented a loss of about 1.0 percent on the day. Read More
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