Crude oil prices fall after Trump calls off Iran strike

Crude oil prices fell more than $1 a barrel on June 12, extending their decline from the previous session. The reason was President Donald Trump’s decision to abandon plans to strike Iran, which eased concerns about further escalation of the conflict after mutual attacks earlier in the week. This is reported by Reuters.

As of 04:10 GMT, Brent crude futures fell $1.83, or 2%, to $88.55 a barrel. At the same time, U.S. West Texas Intermediate (WTI) crude lost $1.60, or 1.8%, to $86.11 a barrel.

Trump, who had previously declared his intention to strike Iran “very hard,” on Thursday abandoned the planned operation.

“While this may well be another false hope, the market reaction has been swift and unequivocal,” said IG market analyst Tony Sycamore.

He said that even with the current decline in quotes, as long as the price remains above support levels around $80, the risks remain largely on the upside.

The US military said on social media that commercial vessels were continuing to pass through the waterway without hindrance.

“We would not rush to assume that the ceasefire will continue. Even if it is maintained, this situation could prove unsustainable. Furthermore, in the absence of progress in the nuclear talks, the agreements could collapse very quickly,” ING analysts said in a note on Friday.

They said the market could enter a decisive phase in late July if oil supplies are not restored by then. In this case, the decline in inventories combined with the traditional seasonal increase in demand could raise prices to $120-$130 per barrel.

On the eve, US President Donald Trump said that after negotiations with the top leadership of Iran, the planned strikes on the country were canceled, but the naval blockade would remain in effect until a peace agreement was reached.

At the same time, the spokesman for the Iranian Ministry of Foreign Affairs, Esmail Bahai, said that reports of alleged final agreements between the US and Iran were not true.

Tags: prices