West Texas Intermediate (WTI) crude oil prices declined to near $93.50 per barrel after reports from both Israel and Iran indicated a halt in hostilities, reversing modest gains from the previous day [1]. Earlier, oil prices had risen following renewed tensions between the United States and Iran, with the US military conducting retaliatory strikes on Iranian targets in Bandar Abbas and Qeshm Island in the Strait of Hormuz on Thursday [1]. A senior US official emphasized that these strikes should not be interpreted as a resumption of war or the end of any existing ceasefire agreement [1].
US Central Command reported that Iranian forces launched missiles, drones, and small-boat assaults against three US guided-missile destroyers—USS Truxtun, USS Rafael Peralta, and USS Mason—while they were transiting the Strait of Hormuz. CENTCOM described these actions as unprovoked and stated that US forces responded under the right to self-defense [1]. In contrast, Iran’s military accused the US of breaching the ceasefire, alleging that American forces targeted two ships and struck civilian areas in the Strait of Hormuz, according to Reuters [1].
Amid these developments, the Trump administration is awaiting Iran’s response to a proposal aimed at reopening the Strait of Hormuz and ending the nearly 10-week conflict. Tehran is expected to communicate its response through Pakistan within the next two days, while tensions remain elevated across the Persian Gulf and Lebanon [1].
The market reaction to the signals of de-escalation was a decline in WTI oil prices, reflecting reduced immediate geopolitical risk, though the situation remains fluid with ongoing diplomatic efforts and unresolved tensions [1].
CONCLUSION
WTI crude oil prices fell as Israel and Iran signaled a pause in hostilities, easing immediate market concerns. However, ongoing diplomatic negotiations and persistent regional tensions suggest that volatility in oil prices may continue in the near term.