Oil Prices Plummet as US-Iran Conflict Eases

Oil prices plummeted on July 27th as the US and Iran paused further military strikes, easing fears of a wider Middle East conflict and disruption to oil supply routes.

Brent crude futures for September delivery dropped by as much as 7% to around $90.90 a barrel after US President Donald Trump halted further strikes on Iran. The move came after nearly two weeks of escalation that pushed Brent above $100 a barrel for the first time since May.

The decline in oil prices has mixed effects on the FTSE 100, with energy majors such as BP and Shell tending to fall due to lower crude prices compressing production margins. On the other hand, airlines and other oil-cost-sensitive sectors tend to rise, benefiting from cheaper fuel costs.