US Shifts Iran Strategy, Drives Oil Prices Below $85
US economic pressure on Iran has replaced military strikes as the preferred strategy in Washington, driving oil prices below $85 per barrel. This shift follows a report from Axios that US Secretary of State Marco Rubio told allied foreign ministers that new strikes against Iran are unlikely 'for the time being'.
The reduced expectation of further US military action and hopes for increased oil flows through the Strait of Hormuz have pushed Brent crude futures below $85 per barrel. The price dropped 2.8% from its previous close, while WTI futures fell 1.4%. This decline is also due to traders taking profits after a temporary maritime corridor agreement between Iran and Oman alleviated supply concerns.
The new shipping route will be seven miles wide in the Strait of Hormuz, with negotiations continuing on establishing a permanent route. Iranian Deputy Foreign Minister Kazem Gharibabadi emphasized that Iran retains full control over the waterway and that any US minesweepers entering the area would become targets for them.