Global crude oil prices decreased by nearly 1% for the second consecutive day as US President Donald Trump’s remarks raised optimism for a potential diplomatic breakthrough with Iran. Brent crude futures fell by 0.9% to $110.28 per barrel, and US West Texas Intermediate (WTI) crude futures declined by about 1% to $103.12 per barrel. The drop followed positive signals from talks between Washington and Tehran.
Moreover, experts suggest that the short-term outlook for oil prices remains cautiously positive due to ongoing developments in West Asia. However, market sentiment is tempered by uncertainties surrounding peace negotiations and ongoing disruptions in oil supplies from the region. Investors are closely watching for a possible agreement between the US and Iran to ensure lasting peace.
During the annual Congressional Picnic, Trump expressed confidence that the conflict with Iran would end swiftly, noting Iran’s eagerness to make a deal. He anticipated a significant drop in global oil prices, attributing it to the surplus supply in the market. Trump emphasized that oil prices are expected to decrease substantially in the upcoming weeks due to oversupply.
Meanwhile, Citigroup projects that Brent crude prices could rise to $120 per barrel in the near future. Morgan Stanley characterized the oil market as being in a time-sensitive situation, cautioning that if the Strait of Hormuz remains closed into June, factors limiting price increases could weaken. The brokerage highlighted that increased US crude exports and reduced Chinese imports have helped mitigate a more severe supply shock.
