Norwegian Krone Drops as Oil Prices Stabilize Following US-Iran Ceasefire

A recent decline in oil and gas prices has led to a drop in the value of the Norwegian krone, making it one of the weakest currencies this week. The price decrease is attributed to the cessation of attacks between the US and Iran, which had previously driven up oil prices.

According to XTB Research, the decline in oil prices can be seen in Figure 1, with a significant drop in the 50-day period following the event. However, it's worth noting that the current situation is slightly different from what was presented by Iranian officials, who claim there is no direct dialogue between US and Iranian officials.

The Strait of Hormuz remains closed, limiting ship traffic to around a dozen daily, compared to 80-140 in standard conditions. Any signs of progress in negotiation talks could lead to a gradual price drop, but the market seems less responsive to these communications.