US-Iran Tensions Ease, Crude Oil Prices Plunge by Over 5%

Crude oil prices plummeted on Monday after US President Donald Trump announced that he would not pursue a planned attack against Iran. As a result, traders removed part of the geopolitical risk premium tied to the conflict with Iran.

Brent crude oil dropped by 5.1% to $83.44 per barrel, while West Texas Intermediate (WTI) fell by 5.8% to $79.77. The sell-off was attributed to the easing of tensions between the US and Iran, which had been causing concerns about the safety of oil shipments through the Strait of Hormuz.

However, despite the decrease in prices, analysts are cautious about predicting a rebound in the market. The Brent weekly chart shows that the benchmark remains in a weak corrective structure, and a short-term rebound could face renewed selling until price forms a clearer bottom.

The Caspian Pipeline Consortium resumed oil loading at its Black Sea terminal on July 27, which added to the bearish pressure on crude oil prices. OPEC+ also approved a September output increase of about 188,000 barrels per day, completing the phased return of 1.65 million barrels per day in voluntary cuts introduced in 2023.