Oil Drops 6% as US Pause in Iran Strikes Eases Middle East Supply Fears
Summary
- Brent crude fell about 6% to around $91 a barrel as the US pause in strikes on Iran eased concerns over Middle East supply disruptions.
- Global oil prices have climbed about 30% this month as the conflict between the US and Iran spread beyond the Strait of Hormuz to the Red Sea, and Brent rose above $100 a barrel last week.
- Market focus is now on President Donald Trump's next move and whether supply disruptions emerge in the Red Sea.
Forecast Trend Report by Period
Oil prices fell sharply after the US halted strikes on Iran, easing concerns over supply disruptions in the Middle East.
According to Bloomberg on July 26, Brent crude dropped about 6% to around $91 a barrel. West Texas Intermediate traded below $84 a barrel, while European natural gas prices fell as much as 7.8% during the session.
The move lower followed expectations that military tensions in the Middle East could ease after the US stopped its 13-day campaign of strikes on Iran after the night of July 24. Iran's military also said it had suspended retaliatory attacks after the US paused its airstrikes.
Tensions in the region have not fully abated. Yemen's Iran-backed Houthi rebels claimed on July 25 that they attacked Saudi Aramco-related facilities in Jizan and Yanbu on Saudi Arabia's Red Sea coast. Saudi authorities and Aramco did not immediately confirm the claim.
Yanbu is the western endpoint of Saudi Arabia's East-West pipeline and has been used as a key crude export hub after oil shipments through the Strait of Hormuz were effectively blocked. Jizan also has Aramco refining facilities and an export terminal.
Global oil prices have climbed about 30% this month as the conflict between the US and Iran spread beyond the Strait of Hormuz to the Red Sea. Brent briefly rose above $100 a barrel last week.
With the US pausing its strikes for now, markets are focused on President Donald Trump's next move and whether supply disruptions emerge in the Red Sea.
