Shortly after 12:00 CET, the price of Brent fell by approximately six percent to close to $93.97 per barrel. At the same time, American light oil WTI lost almost five percent and fell below 86.72 dollars per barrel.
“Ceasefire expectations have risen slightly and the market is dominated by profit-taking,” said Nissan Securities Investment chief analyst Hirojuki Kikukawa. “However, the prospect of a successful negotiation remains uncertain, which limits the sell-off,” he added.
US President Donald Trump confirmed from the Oval Office that he backed down from his previous threat to strike Iran’s energy infrastructure, writes Mettisglobal.
“I withdrew on the basis that we are negotiating,” he said. When asked for details, the president added, “He’s talking to us and he’s talking sense,” as reported by CNBC.
Tehran officials called the claims “fake news,” according to the BBC, with a Foreign Office spokesman saying Tuesday night that “nobody can trust American diplomacy.”
“Can anyone believe that their claims of diplomacy or mediation are credible when they started this war and continue to attack us?” said, for example, Iranian diplomat Esmail Baghaei.
Tehran previously rejected claims that it was in contact with the US, calling it an attempt to manipulate markets.
Israel’s Channel 2 reported that Washington is seeking a month-long truce to discuss a plan that includes dismantling Iran’s nuclear program, ending support for armed groups in the region and reopening the Strait of Hormuz. The latter is key for the export of oil and natural gas from the countries of the Middle East.
The war began on the last day of February with the American-Israeli attack on Iran. Before the start of the war, roughly a fifth of the world’s oil and gas supplies passed through the Strait of Hormuz. Due to threats from Iran, shipping in this strait has practically stopped.
It is necessary to monitor further developments
“The drop in oil prices below $100 per barrel is a positive signal for global logistics, which can reduce transport costs in the short term and ease the pressure on pricing in supply chains. At the same time, it remains crucial to monitor geopolitical developments, as the situation in the Middle East remains volatile,” Petr Škoda, CEO of the logistics company JUSDA Europe, told Novinkám.
According to him, more stable energy prices can support planning and optimization of operations. “At JUSDA, we perceive this situation as an opportunity for further streamlining our clients’ supply chains. However, at the same time, we recommend not to underestimate the risks and to continue building the resilience of supply networks,” he added.
“The key will be whether the negotiations really turn into a long-term truce. In such an uncertain environment, we recommend clients work with multiple development scenarios and actively manage risks. The current situation also underlines the importance of strategic management of commodity inputs and energy costs. Companies that have robust crisis plans will be able to react faster and more effectively than their competitors,” Ivana Brancuzká, CEO and partner of the Crowe consulting firm, told Novinka.
