Oil Prices Retreat, Trump Extends Deadline for Iran Energy Strikes to April 6
Oil prices weakened after US President Donald Trump again extended the deadline for planned attacks on Iranian energy facilities, providing a short-term respite but extending the conflict into early April. WTI fell about 1.6% to US$93/barrel after surging nearly 5% on Thursday, while Brent had previously closed 5.7% higher at US$108.01/barrel.
Trump said Iran requested a seven-day extension, but the US granted 10 days, bringing the new deadline to April 6. ING believes the extension eases market tensions for now, but price risks remain elevated as approximately 8 million barrels per day of supply are already offline, and energy flows in the Persian Gulf remain vulnerable. The market is increasingly aware that the conflict has no definitive end in sight, and risks remain high heading into the weekend.
This month's rally remains strong and highly volatile as the US-Israel-Iran war disrupts supplies from the energy-rich region. The near-total closure of the Strait of Hormuz restricts energy flows vital to the global economy. Trump also mentioned a 4-6 week military operational framework and claimed the operation was “ahead of schedule,” while the extended deadline allows for talks and additional time for the deployment of US forces, including the Marine Expeditionary Unit.
Macquarie assessed the conflict’s duration scenarios as divided: about a 60% chance of ending by the end of March, but a 40% chance of the conflict extending to the end of June. In the longer scenario, they predicted oil could be pushed to US$200/barrel, reflecting tail risks that have not dissipated despite the temporary respite.
On the Iranian side, Tasnim reported that Tehran is awaiting a response after rejecting the US 15-point plan and putting forward its own conditions, including recognizing Iran’s authority over Hormuz. The Strait typically carried about a fifth of global oil flows before the war. While flows remain far from normal, there has been a slight increase in Iranian-linked vessels attempting to sail in the past 24 hours.
Trump said Iran was allowing 10 tankers to pass through the strait as a goodwill gesture, while Treasury Secretary Scott Bessent said an insurance program to encourage cruise ships would begin soon. In the US, crude oil prices have surged nearly 40% throughout March, and prices for products like diesel and aviation fuel have risen even more sharply, heightening concerns about the combination of rising inflation and weakening growth.
Source: Newsmaker.id
