Synopsis
Brent crude oil prices: Oil prices fell below $100 per barrel after President Trump announced a two-week ceasefire with Iran, subject to the safe reopening of the Strait of Hormuz. This development, avoiding a potential escalation, saw Brent crude fall to $94.43 and WTI to $96.82.
ETMarkets.comOil prices have seen a significant decline below $100 per barrel. This followed US President Donald Trump’s announcement of a two-week ceasefire with Iran. In a major relief for the global economy, oil price fell below $100 a barrel on Wednesday after U.S. President Donald Trump said he had agreed to a two-week ceasefire with Iran, subject to the immediate and safe reopening of oil. Strait of Hormuza critical chokepoint that carries a fifth of global flows.
The shift in stance comes just ahead of Trump’s deadline for Iran to reopen the Strait of Hormuz, a key route that carries 20% of the world’s oil supply, or face widespread attacks on its civilian infrastructure.
“It will be a two-sided CEASE-FIRE!” » Trump wrote on social media. Earlier Tuesday, he warned that “an entire civilization would die tonight” if his demands were not met.
Brent crude oil price on March 8
Brent crude fell $14.84, or 13.6 percent, to $94.43 a barrel, while WTI fell $16.13, or 14.3 percent, to $96.82 a barrel by 0023 GMT.
Iran has said it will stop its attacks if actions against it stop. It also indicated that safe passage through the Strait of Hormuz would be ensured for two weeks in coordination with its armed forces, according to a statement from Foreign Minister Abbas Araqchi on Wednesday.
Trump also said the United States had received a 10-point proposal from Iran, describing it as a viable basis for negotiations, and added that the two sides were close to reaching a long-term peace deal.
The US-Israeli war against Iran led to the largest monthly rise in oil prices on record in March, rising by more than 50%.
Over the past month and a half, the war has focused heavily on critical energy infrastructure, disrupting key supply channels and increasing concerns in global energy markets.
What do the experts say?
International brokerage Macquarie said that even if tensions ease in the near term, oil prices are likely to find support in the $85-$90 range.
Experts say that if ongoing tensions persist, the outlook for crude oil will remain volatile and trending higher. Continued conflict in the Middle East, particularly disruptions around the Strait of Hormuz, would keep supply chains under stress, pushing Brent and WTI prices higher and sustaining inflationary pressures around the world.
“Even with a peace deal, Iran may be emboldened to threaten the Strait of Hormuz more frequently in the future, and the market will price in increased risk to the Strait of Hormuz in the future,” Saul Kavonic, an analyst at MST Marquee, told Reuters.
(Disclaimer: The recommendations, suggestions, views and opinions expressed by the experts are their own. These do not represent the views of The Economic Times.)
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