Oil Prices Plummet Amid US-Iran Truce Hopes and Diesel Export Ban Rumors
Crude oil prices took a hit on Friday, plummeting by about 2% due to hopes for a truce between the US and Iran. This development, coupled with rumors of a possible ban on diesel exports by America, weighed heavily on markets.
The Brent futures index dropped $2.28 or 2.1% to settle at $104.32 a barrel, while the US West Texas Intermediate (WTI) crude declined by $2.20 or 2.3% to $92.41 per barrel. This price drop suggests that markets expect US refiners to process less crude oil if their diesel output gets stuck domestically.
US and Iranian negotiators are currently exploring a phased path out of war, which would involve Tehran reopening the Strait of Hormuz and the American government lifting its economic blockade on Iran. However, Iran has stated that it will show no flexibility over its nuclear program even if the US accepts its proposal to reopen the strait.
The talks come as Saudi Arabia faces increasing attacks from Houthi fighters, disrupting oil supply from the Middle Eastern producer. The Houthis have launched strikes on the Saudi-backed government in Yemen and repeatedly fired into Saudi Arabia, part of a wider Middle East conflict that began with US and Israeli strikes on Iran on February 28.