On Thursday night, Israel retaliated against Iran in response to the latter's April 13 airstrikes. According to a report from the BBC, explosions were also reported in Iraq and Syria. Crude oil futures (BZ=F, CL=F) remain largely unaffected, to the surprise of some on Wall Street.

Yahoo Finance Senior Columnist Rick Newman joins the Morning Brief to break down the conflict between Israel and Iran.

For more expert insight and the latest market action, click here to watch this full episode of Morning Brief.

This post was written by Nicholas Jacobino

Video Transcript

SEANA SMITH: Well, tensions rising in the Middle East after Israel's retaliatory military strike on Iran. Iranian media is now downplaying the severity of this incident, Al Jazeera reporting that an Iranian parliament member is calling the attack a desperate attempt. Joining us now is Yahoo Finance senior columnist, Rick Newman. Rick, it's good to see you.

So obviously, on the heels of this, there's a little bit of concern about escalation fears and exactly what that could potentially look like. So just give us I guess a lay of the land of where things stand today and how likely it is that we will see any sort of escalation.

RICK NEWMAN: I think we could interpret this almost the opposite direction, Seana. I think markets had priced in more escalation than we actually got here. And I'll just give you-- I'll just read quickly from one note. I'm looking at this from Moody's Analytics, "A soft Israeli military response to Iran's weekend attack well arrest the upward momentum in oil prices."

And the way that analysts interpret what happens is almost as important as what actually happens, and I think we're seeing that in the price of oil today. It is not going up. I mean, it's actually drifting down maybe just a little bit as if this attack will have no effect. So if you read between the lines here, both sides, Israel and Iran seem to be indicating that they want to be finished with this over shooting phase and return to the shadow war that we've had for, I don't know, 45 years or however long it's been.

So I think there's a reasonably good chance that we're not going to see any more missiles and drones flying between these two countries in the foreseeable future. This does not mean the war is over. I mean, Israel is still conducting its operation in Gaza against Hamas, that could go on for some time and this will remain unpredictable. But it feels like we dodged a bullet here.

BRAD SMITH: And to what extent, Rick, are we seeing the White House and the US response also impact markets?