Oil Prices Plunge 5 Percent as Israel-Iran Agree to Halt Attacks
International benchmark Brent crude tumbled 5% to around $90 per barrel — its weakest level since March — while US benchmark West Texas Intermediate (WTI) shed more than 5% to trade near $86.4 per barrel.
What Triggered the Selloff
The sharp decline was set in motion after Israeli Prime Minister Benjamin Netanyahu announced that Israel would suspend its strikes, while cautioning that any further aggression from Tehran would draw a firm response. Iranian state media echoed a parallel stance, signaling a mutual, if fragile, pause in hostilities.
Adding to the de-escalation narrative, US President Donald Trump declared this week that negotiations were entering their final stage and that a definitive outcome could crystallize within days. Trump went further, asserting that the US could declare "total victory" in the conflict within two weeks.
US Energy Secretary Chris Wright offered additional reassurance on Tuesday, stating that ship traffic through the Strait of Hormuz is rising "very meaningfully" — a development closely watched by energy traders worldwide.
War Premium Fades, But Prices Hold Above Prewar Levels
The easing of geopolitical risk has visibly eroded the war premium baked into crude valuations, though prices remain elevated relative to pre-conflict benchmarks as markets grapple with residual uncertainty over regional stability and the security of key shipping lanes.
Demand-side headwinds compounded the downward pressure. China's crude imports slumped to approximately 7.8 million barrels per day last month — the lowest reading in more than eight years and nearly 4 million barrels per day below the 2025 average — a stark signal of weakening appetite from the world's largest oil importer.
The combination of Chinese demand weakness, record US crude exports, and coordinated emergency reserve releases has collectively cushioned global markets from the full price impact of the conflict's supply disruptions.
What Markets Are Watching Next
With Brent hovering near $90.85 and WTI around $87.59, traders are laser-focused on whether the ceasefire holds. Any renewed flare-up involving key regional producers or critical transit routes could rapidly reignite supply fears and send prices surging once again.
Legal Disclaimer:
MENAFN provides the
information “as is” without warranty of any kind. We do not accept
any responsibility or liability for the accuracy, content, images,
videos, licenses, completeness, legality, or reliability of the information
contained in this article. If you have any complaints or copyright
issues related to this article, kindly contact the provider above.
Legal Disclaimer:
EIN Presswire provides this news content "as is" without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the author above.
