Oil prices fell sharply in Asian trade on Tuesday after President Donald Trump announced that a ceasefire had been brokered between Iran and Israel, ending their bitter conflict in 12 days.
But crude prices trimmed some losses as markets awaited official confirmation of the ceasefire from Iran and Israel.
Brent oil futures for August fell 3.2% to $69.20 a barrel, while West Texas Intermediate crude futures fell 3.2% to $65.10 a barrel by 21:05 ET (01:05 GMT).
Trump announces Iran-Israel ceasefire, official word awaited Trump said that Israel and Iran agreed to a complete ceasefire, and that Iran will begin the ceasefire almost immediately, followed by Israel in 12 hours. Trump said that the Israel-Iran war will end after 24 hours of the ceasefire remaining in place.
Trump’s announcement was preceded by what was seen as a restrained strike by Iran on a U.S. military base in Qatar. Trump had called the move a “very weak response” to the U.S. attacks on Iran’s nuclear facilities over the weekend.
Oil prices had fallen sharply after the attack, given that there were no reported casualties. Markets were also relieved by Iran choosing to attack the base instead of oil tankers in the Strait of Hormuz.
But markets were awaiting official word from Iran and Israel on a potential truce, especially as reports showed attacks between the two countries stretched on into the early hours of Tuesday.
3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads. Iranian foreign minister Abbas Araghchi said that as of now, there was no agreement on any ceasefire between Iran and Israel, and that the final decision on a truce will be made later.
Araghchi also warned that if Israel did not cease its attacks on Iran, Tehran will continue to retaliate.
Oil nurses steep losses amid Israel-Iran deescalation hopes Tuesday’s losses in oil were an extension of a sharp decline seen on Monday, where prices wiped out about 8% amid growing hopes that the Israel-Iran conflict will simmer down.
Oil’s losses were triggered by a seemingly muted response from Tehran to U.S. attacks on its nuclear infrastructure. Tehran attacked a U.S. military base in Qatar, although no casualties were reported.
Concerns over oil supply disruptions were also quashed by Iran not blocking the Strait of Hormuz, as initially feared.
