Oil Falls Below $100 as Trump Extends Ceasefire Deadline
Oil prices declined on Wednesday as signals of a ceasefire deadline extension eased supply concerns, after climbing above $101 on Tuesday on escalating tensions between the US and Iran.
International benchmark Brent crude traded at $97.85 per barrel, down around 0.6% from the previous close of $98.48. US benchmark West Texas Intermediate decreased about 1.8% to $88.86 per barrel, compared with $90.51 in the previous session.
Oil prices fell after US President Donald Trump said Tuesday that Washington would extend its ceasefire with Iran to allow time for Tehran to prepare a “unified proposal,” following a request by Pakistani officials.
In a statement on his social media platform Truth Social, Trump said the US was asked by Pakistan’s army chief Field Marshal Asim Munir and Prime Minister Shehbaz Sharif to delay renewed military action against Iran until their leaders could “come up with a unified proposal.”
The ceasefire, initially announced earlier this month, had been set to expire Wednesday.
However, the US seizure of an Iranian-flagged cargo vessel and Tehran’s threat of retaliation were among the developments escalating tensions. Iran also announced it had once again closed the Strait of Hormuz, citing a US blockade of its ports and coastal areas.
Iranian Foreign Minister Abbas Araghchi said in a social media post that the blockade of Iranian ports amounted to an act of war, adding, “Blockading Iranian ports is an act of war and thus a violation of the ceasefire. Striking a commercial vessel and taking its crew hostage is an even greater violation.”
– Uncertainty over talks persists
Uncertainty continues to surround planned US-Iran talks in Pakistan. Iranian officials have yet to confirm participation, while the US vice president’s scheduled visit has reportedly been postponed.
Shipping flows through the Strait of Hormuz, a critical artery for global oil supply, have slowed sharply. Only three vessels reportedly transited the waterway in the past 24 hours, signaling severe disruption.
Despite ongoing supply risks, analysts say expectations that the ceasefire will hold and diplomatic efforts will continue are capping further price gains.
Meanwhile, the US Energy Information Administration (EIA) is due to release its weekly petroleum inventory data later in the day.
Industry data from the American Petroleum Institute showed US crude stockpiles fell by 4.5 million barrels last week, reversing three consecutive weekly builds.
Gasoline and distillate inventories also declined. Analysts expect official data to show a crude draw of about 1.2 million barrels for the week ended April 17. Banks Placement, OMO Inflows Keep Money Market Liquid
