Oil prices on Wednesday morning dipped some 2% as U.S. President Donald Trump signaled that the United States may wind down its military operations in Iran soon, while threatening to quit NATO for its lack of support in the Middle East operation. Iran announced on Tuesday it was ready to reach a resolution or intensify attacks on U.S. assets and its allies, without offering more details how this would be achieved considering the conflicting demands between the two sides. Two Pakistan sources told Reuters that neither side had responded to Islamabad’s proposal for a temporary ceasefire.
“I can’t tell you exactly … we’re going to be out pretty quickly,” Trump told reporters. “They won’t have a nuclear weapon because they are incapable of that now, and then I’ll leave, and I’ll take everybody with me, and if we have to we’ll come back to do spot hits,” he added.
Oil prices eased in Wednesday’s session on hopes of quick de-escalation of the conflict. Brent crude for May delivery was down 1.9% to trade at $102.01 per barrel at 11.41 am ET, while the corresponding WTI crude contract fell 1.27% to trade at $100.01/bbl.
Oil prices remain more than 40% above late February levels when the war broke out. It’s doubtful whether the region will return to its pre-crisis state any time soon with tensions still very high. Iran’s Islamic Revolutionary Guard Corps (IRGC) has issued a direct threat to target 18 American technology and industrial companies in the Middle East including Microsoft, Google, Intel, Tesla, IBM, Apple and Boeing. The IRGC has labeled these firms as “legitimate targets,” alleging they are “spy companies” involved in designing and tracking targets for U.S. and Israeli military operations.
Meanwhile, Yemen’s Houthi rebels have launched coordinated attacks involving multiple missile and drone strikes against southern Israel. The group has warned they may escalate further by closing the Bab al-Mandeb strait to Israel-linked ships, threatening a naval blockade that could impact 30% of Israel’s imports. The coordinated offensive marks an escalation of tensions following a month of the Houthis remaining on the sidelines after the broader U.S.-Israeli conflict with Iran began in February 2026.
By Charles Kennedy for Oilprice.com
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