Oil prices fell today, with global benchmark Brent crude dropping 1%, after US President Donald Trump said he had paused a planned attack on Iran to allow for negotiations to end the war in the Middle East.
Trump posted on social media yesterday that he was holding off from a military attack that had been scheduled for today while efforts to reach a deal with Iran continued, adding that the US was ready to resume attacks if a deal is not reached.
Brent futures for July were down $1.27, or 1.13%, at $110.83 a barrel this afternoon.
The US West Texas Intermediate crude contract for June delivery, which expires today, slipped 45 cents, or 0.41%, to $108.21. The more active July contract fell 38 cents, or 0.36% to $104.
"We continue to jump from one news cycle to the next, with plenty of noise being created, but so far no meaningful developments pointing toward the beginning of the end of the war," said Saxo Bank analyst Ole Hansen, adding that Trump's comments had driven oil lower.
In the previous session, Brent and WTI hit their highest since May 5 and April 30 respectively.
The Middle East conflict has effectively closed the Strait of Hormuz, a critical waterway that typically carries about a fifth of global supplies of oil and liquefied natural gas, creating the world's biggest oil supply disruption, according to the International Energy Agency.
Tehran's latest peace proposal to the US involves ending hostilities on all fronts including Lebanon, the exit of US forces from areas close to Iran and reparations for destruction caused by the war, state media reported today.
Separately, US Treasury Secretary Scott Bessent extended a sanctions waiver by 30 days to allow "energy-vulnerable" countries to continue purchasing Russian seaborne oil.
In the US, a record 9.9 million barrels were drawn from the Strategic Petroleum Reserve last week, Energy Department data showed, bringing stockpiles down to about 374 million barrels, the lowest since July 2024.
US crude stocks are expected to have fallen by about 3.4 million barrels in the week to May 15.
