Oil prices fall below $100 after Iran-US ceasefire agreement
Oil prices fell below $100 per barrel, while Asian markets and U.S. stock futures surged after the United States (U.S.) and Iran agreed on a two-week ceasefire, which includes the reopening of the Strait of Hormuz.
Futures for U.S. crude dropped 14.3% to $96.83 per barrel, and Brent crude fell 13.3% to $94.74 per barrel, CE Report quotes FENA.
Oil prices had spiked sharply earlier because the war disrupted production and transportation of crude oil in the Persian Gulf. A large portion of this oil passes through the Strait of Hormuz to reach customers worldwide, but Iran had blocked it.
Japan’s benchmark Nikkei 225 index rose 4.8%, and South Korea’s Kospi increased 5.6%. S&P 500 futures advanced 2.3% as of 9:30 p.m., while Dow futures rose 2%.
Late yesterday, Trump said he was postponing attacks on Iranian bridges, power plants, and other civilian targets. Iran’s foreign minister stated that passage through the strait would be allowed for the next two weeks under Iranian military control.
The dramatic price movements are the latest swings to hit financial markets since late February due to constantly changing signals about when the conflict might end. Even with the ceasefire news, neither Iran nor the U.S. specified when it would start, and attacks occurred this morning in Israel, Iran, and across the Persian Gulf region.
Oil prices remained volatile. The price of a barrel of U.S. benchmark crude for May delivery briefly rose above $117 before settling at $112.95.
Market concerns were that the disruptions would keep oil prices high for an extended period, sending a painful wave of inflation that would affect the global economy. Trump kept traders on edge with a series of threats to blow up Iranian power plants, which he postponed several times afterward.
The average price of a gallon of regular gasoline in the U.S. jumped to $4.14, according to AAA. It had been below $3 just a few days before the U.S. and Israel launched attacks on Iran, AP reports.
Foto/ Woodside arhiv
