Oil prices plunge after Trump announces Iran-Israel ceasefire

Oil prices fell sharply after Donald Trump announced a ceasefire between Iran and Israel, which eased fears of disruptions to oil supplies from the Middle East, one of the world’s key oil-producing regions.

Reuters reports this.

In particular, the price of Brent futures fell by 2.9% to $69.40 per barrel, although during trading the decline exceeded 4%. This is the lowest level since June 11. American WTI oil fell by 3% to $66.50, which was the lowest since June 9.

US President Donald Trump said Iran has agreed to a ceasefire immediately and Israel will join the truce in 12 hours. If both sides abide by the agreement, the conflict will be officially over within 24 hours. This brings an end to the fighting that has lasted for the past 12 days.

As Phillip Nova analyst Priyanka Sachdeva notes, if the agreements are maintained, the situation on the oil market may stabilize.

Iran is the third largest oil producer among OPEC countries, so a reduction in tensions could lead to an increase in its exports. This, in turn, could have a positive impact on the stability of the global oil market.

Oil prices had previously surged to five-month highs after US strikes on Iranian nuclear facilities sparked fears that the conflict could disrupt supplies through the Strait of Hormuz, a critical maritime artery through which up to 19 million barrels of oil pass daily, accounting for nearly 20% of global consumption.

As a reminder, the Iranian parliament supported the idea of closing the Strait of Hormuz, which is an important oil and gas route, in response to Western pressure.

As reported, the European Union has postponed a plan to lower the price ceiling for Russian oil, given the risk of rising energy prices due to the conflict in the Middle East.

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