Oil Prices Fall on Easing Supply Risk, Brent Dips Below $97
Oil prices fell on Monday on an easing supply-risk outlook in the global commodity market after US President Donald Trump suggested further military strikes on Iran were unlikely if Washington and Tehran reached an agreement.
International benchmark Brent crude futures for January delivery fell around 1.9% to $96.49 a barrel, compared with the previous close of $98.32.
US benchmark West Texas Intermediate (WTI) crude futures for December delivery dropped 1.2% to $89.75 a barrel, down from $90.83 at the previous close.
Trump told CNN that renewed US strikes on Iran were “highly unlikely” if Tehran agreed to a deal covering its nuclear program and access through the Strait of Hormuz.
“It depends on whether or not they sign a very strong agreement … The answer is highly unlikely it’s going to be necessary,” Trump told CNN, adding he would strike if he thinks it is “necessary.”
Trump said that the American military had already inflicted severe damage during earlier engagements of the Iran war, maintaining that forces could resume strikes and “finish them off.”
“We’re ready for it. I’ve got three aircraft carriers here. The other one just arrived. We have three. They’re fully locked and loaded,” he said.
Despite hopes for a diplomatic breakthrough, fresh US strikes on Iran and continued security incidents around the Strait of Hormuz highlighted the fragile situation in the region.
Overnight US strikes on Iran’s Qeshm Island caused no damage to residential or commercial areas or vital infrastructure, Ahmad Nafisi, deputy governor of the southern Hormozgan province, said Monday, according to the semi-official Fars news agency.
Nafisi said the situation on the island, near the entrance to the Strait of Hormuz, was under control, with emergency services and public utilities remaining on high alert.
“The targeted sites were outside residential and commercial areas and public service infrastructure, and no damage was caused to the island’s vital infrastructure or essential services,” Nafisi said.
Separately, Iran’s Islamic Revolutionary Guard Corps (IRGC) Navy said late Saturday that two oil tankers caught fire after hitting naval mines in and near the strait.
The IRGC said the tankers switched off their navigation and positioning systems and attempted to use an unauthorized route. It accused both vessels of multiple violations, saying one was hit east of the strait and the other inside it.
Earlier on Saturday, the US military’s Central Command (CENTCOM) said an American aircraft disabled a cargo ship in the Gulf of Oman after repeated attempts to breach the US naval blockade of Iran.
CENTCOM identified the vessel as the St. Kitts-flagged Huda and said it had visited an Iranian port. Oil Prices Surge as US Strikes Iran’s Island, Brent Tops $106
