Oil falls as investors weigh chance of US intervention in Iran-Israel conflict
BEIJING: Oil prices slipped on Thursday as investors hesitated to take new positions after U.S. President Donald Trump gave mixed signals on the country's potential involvement in the ongoing Israel-Iran conflict.
Brent crude futures fell 37 cents, or 0.48%, to $76.33 a barrel by 0110 GMT after gaining 0.3% in the previous session marked by high volatility, with prices falling as much as 2.7%.
U.S. West Texas Intermediate crude for July fell 28 cents, or 0.37% to $74.86 a barrel, after settling up 0.4% in the previous despite dropping by as much as 2.4%.
The July contract expires on Friday and the more active August contract was down 21 cents, or 0.29%, to $73.29 a barrel.
There is still a 'healthy risk premium baked into the price as traders await to see whether the next stage of the Israel-Iran conflict is a U.S. strike or peace talks', Tony Sycamore, market analyst at IG, said in a note.
The former could lead prices to rise by $5 while peace talks could lead to a drop of around the same magnitude, Sycamore said.
Trump on Wednesday told reporters that he may or may not decide for the U.S. to join Israel in its missile attacks on Iran. The conflict stretched into its seventh day on Thursday.
Direct U.S. involvement would widen the conflict, putting energy infrastructure in the region at higher risk of attack, analysts say.
Iran is OPEC's third-largest producer, extracting about 3.3 million barrels per day (bpd) of crude oil.
Oil falls as Iran-Israel conflict enters sixth day
But more crucially, about 19 million bpd of oil and oil products move through the key Strait of Hormuz waterway and there is widespread concern the fighting could disrupt trade flows there.
The U.S. Federal Reserve kept interest rates steady on Wednesday but pencilled in two rate cuts by the end of the year.
Chair Jerome Powell however cautioned the rate cuts would be 'data-dependent' and that more consumer inflation is expected from President Trump's planned import tariffs.
Lower interest rates would stimulate the economy, and as a result demand for oil, but that could exacerbate inflation.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Express Tribune
20 minutes ago
- Express Tribune
Anti-war protesters gather outside White House, urge action against Israel
Hundreds of demonstrators gathered outside the White House on June 18 evening to protest Israel's ongoing military actions in Gaza and Iran, calling for an end to the violence and urging President Donald Trump to resist deeper US involvement in the widening conflict. The protest, organised by the ANSWER Coalition, featured a sea of Palestinian and Iranian flags, keffiyehs, and signs reading 'No New War in the Middle East' and 'Stop US Weapons to Israel.' Demonstrators chanted in support of a 'people's arms embargo', demanding that US arms shipments to Israel be halted immediately. The protest comes as US officials weigh a possible entry into the regional war, following Israel's unprovoked attacks on Iranian soil and Iran's retaliatory missile launches. At one point, a small group carrying Israeli flags arrived, sparking tension as protesters began chanting against Zionism. Police intervened quickly, forming a bicycle barricade to separate the groups. A minor confrontation was observed when an officer pushed back a protester who refused to step away. Despite periods of heavy rain, the demonstration remained peaceful but impassioned, with chants for Palestinian liberation and an end to Israeli military actions across Palestine, Iran, Lebanon, and Yemen. While Israel claimed its attacks targeted Iran's Natanz enrichment site, the International Atomic Energy Agency (IAEA) reported damage to underground centrifuge halls. Iran accused Israel of also hitting residential areas. In response, Iran launched 400 missiles and drones at Israeli cities, including the much-touted Fattah-1 missile. The flare-up also follows statements made by US President Donald Trump, who stated Iran had reached out for negotiations but that it was "very late to be talking". Protests also took place across different cities in the US, with many taking to the streets of New York, Philadelphia, and Orlando to march against US involvement in the Iran-Israel war. Marches are expected to continue until June 21.
Business Recorder
40 minutes ago
- Business Recorder
In meeting with COAS Munir, Trump lauds Pakistan's ongoing efforts for regional peace, stability
US President Donald Trump in a meeting with Chief of Army Staff (COAS) Field Marshal Syed Asim Munir lauded Pakistan's ongoing efforts for regional peace and stability, and appreciated the robust counter-terrorism cooperation between the two states. President Trump was accompanied by Secretary of State Senator Marco Rubio, and Steve Witkoff, the US Special Representative for Middle Eastern Affairs, while Field Marshal Asim Munir was joined in by Pakistan's National Security Advisor,' the Inter-Services Public Relations (ISPR) said in a press release today. The ISPR said that although initially scheduled for one hour, the meeting extended for over two hours, underscoring the depth and cordiality of the dialogue. During the meeting, the army chief conveyed the deep appreciation of Pakistan for President Trump's constructive and result-oriented role in facilitating a ceasefire between Pakistan and India in the recent regional crisis. 'The COAS acknowledged President Trump's statesmanship and his ability to comprehend and address the multifaceted challenges faced by the global community,' said the statement. The two sides also discussed avenues for expanding bilateral cooperation in multiple domains including trade, economic development, mines and minerals, artificial intelligence, energy, cryptocurrency, and emerging technologies. 'President Trump expressed keen interest in forging a mutually beneficial trade partnership with Pakistan based on long-term strategic convergence and shared interests,' said ISPR. President Trump commended the Field Marshal's leadership and decisiveness during a period of complex regional dynamics. Bilawal sees COAS-Trump talks as positive step The two sides also held a detailed exchange of views on the prevailing tensions between Iran and Israel, with both leaders emphasizing the importance of resolution of the conflict. Field Marshal Syed Asim Munir extended an invitation to President Trump, on behalf of the Government of Pakistan, to undertake an official visit to Pakistan at a mutually convenient date. 'The engagement marks a significant moment in the ongoing efforts to reinforce the longstanding partnership between Pakistan and the United States, built upon shared objectives of peace, stability, and prosperity,' the press release added. On Wednesday, President Trump hosted Pakistan's army chief for lunch. The meeting, listed on the president's official schedule, was held in the Cabinet Room and closed to the press.
Business Recorder
an hour ago
- Business Recorder
South Korean shares turn lower as Mideast tensions overshadow tech rally
SEOUL: Round-up of South Korean financial markets: South Korean shares fell on Thursday, weighed by heightening geopolitical tensions in the Middle East, even as tech stocks continued to rally. The won weakened, while the benchmark bond yield was steady. The benchmark KOSPI was down 11.85 points, or 0.40%, at 2,960.34 as of 0142 GMT, after starting the session higher. US President Donald Trump kept the world guessing about whether the United States will join Israel's bombardment of Iranian nuclear sites as the Israel-Iran conflict entered its seventh day on Thursday. South Korea's acting finance minister said authorities would closely monitor financial markets and respond in a timely manner if necessary. Among index heavyweights, chipmaker Samsung Electronics fell 0.67%, while peer SK Hynix was flat. Battery maker LG Energy Solution slid 0.86%. Hyundai Motor and sister automaker Kia Corp were up 0.49% and down 0.71%, respectively. Steelmaker POSCO Holdings was flat, while drugmaker Samsung BioLogics fell 0.60%. Tech stocks extended a rally on policy optimism, with search engine Naver rising 4.11% and instant messenger Kakao climbing 10.14%. Of the total 934 traded issues, 302 shares advanced, while 592 declined. Foreigners were net sellers of shares worth 213.9 billion won ($154.8 million). The won was quoted at 1,381.9 per dollar on the onshore settlement platform, 0.69% lower than its previous close at 1,372.3. In money and debt markets, September futures on three-year treasury bonds were unchanged at 107.11.
