Oil Prices Drop as U.S Announces Plan to Exit Iran
Oil prices dropped sharply in the global commodity market on Wednesday after the U.S. announced its plan to exit Iran in two to three weeks, suggesting the Middle East war could end sooner than expected.
International benchmark Brent crude futures traded at $100.99 per barrel, down around 3.13% from the previous close of $103.97. US benchmark West Texas Intermediate (WTI) decreased about 3.38% to $98.05 per barrel, compared with $101.38 in the previous session.
According to a report by The Wall Street Journal (WSJ), citing US officials, President Donald Trump and his team assessed that a military operation to immediately reopen the Strait of Hormuz could prolong the conflict.
The report claimed that Washington is therefore prepared to end its attacks on Iran even if the Strait remains closed. Strait of Hormuz, which is of critical importance for global oil supply, connects oil and liquefied natural gas (LNG) production in the Middle East to international markets.
Approximately 20 million barrels of oil pass through the strategic waterway daily, accounting for around 20% of global demand.
Following the military strikes launched by Israel and the US against Iran on Feb. 28, disruptions in commercial shipping through the strait and rising security risks heightened supply concerns in global oil markets, even as talks between Tehran and Washington continued.
Experts note that continued disruptions in the strait are keeping supply-side risks alive in the markets. Speaking after a presidential decree signing ceremony at the White House on Tuesday, Trump said that American forces will leave Iran within two to three weeks, signaling an end to ongoing attacks against the country.
“All I have to do is leave Iran, and we’ll be doing that very soon,” Trump said. “We’ll be leaving very soon,” he said, adding that it will happen in “maybe two weeks, maybe three.”
Arguing that the US has no direct stake in the Strait of Hormuz, Trump said countries that need oil passing through the strait should take responsibility.
“We will leave there very soon. If France or any other country wants to buy oil or natural gas, they will pass through the Strait of Hormuz and manage on their own. It does not concern us,” he said.
Iranian Foreign Minister Abbas Araghchi also made statements to Qatar-based Al Jazeera television regarding recent developments.
Araghchi said no decision has yet been made on negotiations, but stressed that Iran’s conditions for ending the war are clear. “We have not responded to 15 proposals from the US. Iran’s conditions include guarantees against repeated attacks and compensation for damages,” he said.
Reiterating that Iran would not accept a ceasefire, Araghchi added, “We want the war to end not only in Iran but across the entire region.” #Oil Prices Drop as U.S Announces Plan to Exit Iran
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