Oil Prices Fall 5% as US-Iran Strikes Pause
Global oil prices fell by more than 5 per cent during early Asian trading on Monday after the United States and Iran paused military attacks, raising hopes of diplomatic de-escalation in the Middle East.
Brent and WTI Crude Prices Fall
Brent crude futures declined by $4.89, or 5.05 per cent, to $91.89 per barrel. The international benchmark briefly traded below the important $90 level earlier in the session.
US West Texas Intermediate crude dropped by $4.67, or 5.23 per cent, to $84.64 per barrel. Both benchmarks reached their lowest levels in nearly a week after recording gains during the previous three weeks.
Brent had climbed above $100 per barrel as escalating US-Iran hostilities disrupted energy shipments and increased concerns about global oil supplies.
US-Iran Strike Pause Calms Markets
The United States halted its bombing campaign after conducting strikes against Iranian targets for 13 consecutive nights. Iran subsequently indicated that it would suspend retaliatory attacks as long as Washington continued holding fire.
US officials said President Donald Trump was allowing diplomatic discussions more time to progress. The pause reduced the immediate risk of another round of attacks on energy infrastructure and commercial shipping.
However, neither Washington nor Tehran has announced a permanent ceasefire, leaving the possibility of renewed escalation.
Strait of Hormuz Risks Remain
Oil markets continue to face uncertainty because shipping traffic through the Strait of Hormuz remains severely restricted. The waterway is a crucial route for crude oil and liquefied natural gas exports from the Gulf.
Additional risks have emerged in the Red Sea, where Houthi attacks on Saudi tankers and energy infrastructure have threatened an alternative export corridor.
Sustained disruptions in either waterway could keep crude prices elevated despite the latest decline. Markets will therefore closely monitor diplomatic negotiations and any movement towards restoring normal commercial shipping through the Strait of Hormuz.
