Oil Prices Plummet as US and Iran Pause Strikes in West Asia

Oil prices plummeted on Monday after the US and Iran paused their strikes in West Asia, temporarily easing regional tensions. Brent crude briefly fell below $90 a barrel, dropping as much as 7% before recovering some losses. The US crude variant, West Texas Intermediate, dropped towards $80 a barrel and was down around 4%. The market seems to be ignoring claims from the Iran-backed Houthis that they struck facilities linked to Saudi Aramco in Jizan and Yanbu on Saturday.

The conflict has been ongoing for several weeks, with both sides engaging in retaliatory strikes. However, over the last two days, there have been no new attacks from either side. This pause in hostilities has led to a sharp drop in oil prices, which had risen by over 20% this month.

Despite the recent price correction, Brent crude remains up by over 20% for the month as tensions continued to escalate. The Iran-backed Houthis announced a maritime embargo on Saudi Arabia after their attack on Yemen's capital Sana'a. The market is also not taking note of Ukraine's attack on an Iranian commercial vessel in the Caspian Sea.