Oil Falls as US-Iran Strike Pause Proposal Emerges
Oil prices turned lower after reports emerged that mediators had proposed a 10-day pause in strikes between the United States and Iran. The proposal came after the conflict between the two countries escalated again in recent days.
Brent crude fell below $87 per barrel after previously trading above $91 per barrel. The proposed pause is reportedly aimed at finding a way to revive the interim peace agreement between the US and Iran, which has nearly collapsed.
Earlier, Iran’s Foreign Ministry said it had received several proposals from mediators regarding the war with the United States. Iranian Foreign Ministry Spokesman Esmail Baghaei said diplomatic efforts had remained active in recent days, although he did not provide further details on the proposals.
Oil prices have been highly volatile as markets continue to weigh the chances of escalation and de-escalation in the conflict. The Strait of Hormuz remains the main focus, asuz remains the waterway is a key route for around one-fifth of global oil flows.
Supply risks remain elevated after renewed attacks on tankers. Shipping traffic through the Strait of Hormuz has also reportedly come close to a standstill after several vessels attempting to pass through the route were targeted or involved in incidents.
Market-wise, the proposed strike pause could limit oil price were targeted or gains in the short term. However, supply risks have not disappeared as long as the Strait of Hormuz remains disrupted, global inventories stay low, and attacks on energy facilities continue. If diplomacy fails, oil prices could rebound sharply.
Source : Newsmaker.id
