Crude oil prices slumped today, following a social media statement by President Trump saying that the Iran-Israel ceasefire is now in effect, putting an end to the war that started on June 13. Israel has agreed to the U.S. ceasefire proposal, while Iran’s state media has reported the ceasefire is now in effect after a final round of missiles.
At the time of writing, Brent crude was trading at $68.78 and West Texas Intermediate was changing hands for $65.81 a barrel, both down by over 4% from Tuesday, when Iran responded to the U.S. bombing of its nuclear sites with a strike on a military base in Qatar.
The first signs of a ceasefire came from President Trumps post on Truth Social in which he said, “On the assumption that everything works as it should, which it will, I would like to congratulate both Countries, Israel and Iran, on having the Stamina, Courage, and Intelligence to end, what should be called, ‘THE 12 DAY WAR’,”. The president then followed that announcement with a confirmation on the same platform, saying “The ceasefire is now in effect. Please do not violate it!”
There is still some uncertainty that the war is over. Iran’s foreign minister, Abbas Araqchi, had said that unless Israel stopped bombing it by 4 am Tehran time on Tuesday, the fighting would continue. According to Reuters, there have been no reports of new Israeli attacks on Iran since that hour.
“The final decision on the cessation of our military operations will be made later,” the top official noted.
Reuters, meanwhile, reported that President Trump had brokered the ceasefire in a phone call with Israel’s Benjamin Netanyahu, who had agreed to stop bombing Iran if Iran stopped bombing it, according to an unnamed White House official.
Earlier this week, following the U.S. strikes on Iran’s nuclear facilities, oil surged in anticipation of Iran’s potential closure of the Strait of Hormuz, which handles a third of global maritime oil exports. Reports of tankers U-turning in the chokepoint or stopping outside it reinforced expectations that this time Iran may indeed go for the blockade, but in the end, the major disruption was once again avoided—for the time being.
By Irina Slav for Oilprice.com
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