Oil prices shift following fresh Middle East developments
Photo: Oil prices fell following the ceasefire between Israel and Lebanon (Getty Images)
Israel and Lebanon have agreed to a ceasefire, and oil prices immediately fell. The markets saw this as a step toward a broader agreement between the US and Iran, which could reopen the Strait of Hormuz, reports Reuters.
Oil prices
Brent crude fell by 87 cents to $96.92 per barrel. U.S. WTI lost 78 cents, dropping to $95.24.
This is a pullback following a 2% rise on Wednesday, when the market reacted to the resumption of hostilities in the Middle East, including Iranian attacks on Kuwait and US strikes near the Strait of Hormuz.
Ceasefire agreement and negotiations with Iran
Late Wednesday evening, Israel and Lebanon announced a transition to a ceasefire. This gave markets hope: one of the conditions of the agreement between Washington and Tehran is precisely a halt to hostilities between Israel and Lebanon.
US President Donald Trump suggested on Wednesday that progress in negotiations with Iran could emerge as early as this weekend. Iranian Foreign Minister Abbas Araghchi, for his part, confirmed that contacts between the parties are ongoing, but there are no concrete results yet.
Oil prices surged to $94 per barrel after peace talks between the US and Iran stalled, and hostilities resumed in the Persian Gulf.
Meanwhile, US President Donald Trump has not ruled out that the blockade of the Strait of Hormuz could last until September 7 - Labor Day in the United States - although he considers this scenario unlikely.
