Oil prices drop as Trump announces Iran-Israel ceasefire
Oil prices experienced a significant drop on Tuesday, reaching their lowest point in over a week, after United States President Donald Trump revealed a ceasefire agreement between Iran and Israel, alleviating fears of potential supply interruptions in the area.Brent crude futures fell by $2.69, or 3.7 percent, to $68.79 a barrel early Tuesday, having previously plummeted more than 4 percent to their lowest since June 11.
On Monday, West Texas Intermediate crude dropped $2.70, or 3.94 percent, to $65.46 a barrel, marking its lowest since June 9, after falling nearly 6 percent earlier in the day.
The decline followed President Trump's announcement of a comprehensive ceasefire agreement between Israel and Iran.
According to the agreement, Iran is to initiate the truce immediately, while Israel will follow suit after a 12-hour period.
If peace is sustained by both parties, the conflict will officially conclude after 24 hours, bringing an end to a 12-day war.
“With the announcement of the ceasefire, we are witnessing a rapid evaporation of the risk premium that had elevated crude oil prices last week,” stated Tony Sycamore, an analyst at IG.
As tensions diminish, Iran, the third-largest oil producer in OPEC, is likely to boost exports, reducing the chances of supply disruptions that had recently caused oil prices to rise.
Leave A Comment