Oil prices drop nearly 6% as Israel-Iran ceasefire reduces Middle East supply risk
NEW YORK: Oil prices fell almost 6% to a two-week low on Tuesday on expectations the ceasefire between Israel and Iran will reduce the risk of oil supply disruptions in the Middle East.
That ceasefire, however, was on shaky ground with U.S. President Donald Trump accusing both Israel and Iran of violating it just hours after it was announced.
Brent crude futures fell $4.02, or 5.6%, to $67.46 a barrel at 1:26 p.m. EDT (1726 GMT). U.S. West Texas Intermediate (WTI) crude fell $3.84, or 5.6%, to $64.67.
Brent was on track for its lowest settlement since June 10 and WTI for its lowest since June 6, both before Israel launched a surprise attack on key Iranian military and nuclear facilities on June 13.
'The geopolitical risk premium built up since the first Israeli strike on Iran almost two weeks ago has entirely vanished,' said Tamas Varga, a senior analyst at TP ICAP's PVM Oil Associates brokerage and consulting firm.
On Monday, both oil contracts settled more than 7% down. They had rallied to five-month highs after the U.S. attacked Iran's nuclear facilities over the weekend.
Oil falls 6pc
The direct U.S. involvement in the war also focused investors on the Strait of Hormuz, a narrow waterway between Iran and Oman, through which between 18 million and 19 million barrels per day (bpd) of crude oil and fuels flow, accounting for nearly a fifth of global consumption.
Prices also fell as Trump posted on social media platform Truth Social that China, the world's second biggest economy behind the U.S., can now continue to purchase oil from Iran.
In other supply news, Kazakhstan's state energy company KazMunayGaz raised its forecast for oil output at the Chevron-led Tengiz oilfield, the country's largest, to 35.7 million metric tons in 2025 from 34.8 million tons expected previously, as it boosts output.
Kazakhstan is a member of the OPEC+ group of countries that includes the Organization of the Petroleum Exporting Countries (OPEC) and allies.
'Prior to the outbreak of hostilities between Israel and Iran, we had been suggesting a bearish stance mainly due to increased OPEC+ production that has prompted ample crude supplies, an evolving dynamic that has intersected with expected demand deterioration largely due to the Trump tariffs,' analysts at energy advisory Ritterbusch and Associates said in a note.
In Guyana, oil output rose to 667,000 bpd in May from 611,000 bpd in April, fueled by increases at two of the three production facilities operated by U.S. major Exxon Mobil.
US oil inventories
The American Petroleum Institute (API) trade group and the U.S. Energy Information Administration (EIA) were due to release U.S. oil inventory data,
Analysts forecast energy firms pulled about 0.8 million barrels of oil from U.S. stockpiles during the week ended June 20.
If correct, that would be the first time energy firms pulled oil from storage for five weeks in a row since January. That compares with a build of 3.6 million barrels during the same week last year and an average decrease of 2.5 million barrels over the past five years (2020-2024).
The API releases its numbers on Tuesday and the EIA on Wednesday.
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Express Tribune
35 minutes ago
- Express Tribune
Gold prices tumble on Israel-Iran ceasefire
Listen to article Gold prices in Pakistan registered a sharp decline on Tuesday, mirroring the downtrend in the international market where bullion slipped nearly 2% to hit a more than two-week low as geopolitical tensions cooled. The global drop came as investor demand for safe-haven assets eased following Trump's announcement of a ceasefire between Iran and Israel. In the domestic market, the price of 24-karat gold fell by Rs3,800 per tola to settle at Rs354,365, according to rates issued by the All Pakistan Sarafa Gems and Jewellers Association (APSGJA). Similarly, the price of 10-gram gold dropped by Rs3,258 to reach Rs303,810. On the previous day, gold had posted a modest decline of Rs300 per tola, closing at Rs358,165. "There had been talk of a correction for several days and with tensions easing, the metal is now gradually retreating," said Adnan Agar, Director at Interactive Commodities, noting that gold was trading lower after geopolitical tensions subsided. Gold touched a high of $3,357 an ounce and a low of $3,303 on Tuesday and is still hovering near its lower range. The key support zone lies between $3,300 and $3,290. "A breach below this level could push the market down towards $3,200," he said. Agar indicated that if the geopolitical situation remains stable, gold prices may continue their downward correction, potentially sliding to $3,000 or even $2,800. Meanwhile, the Pakistani rupee registered a slight gain against the US dollar in the inter-bank market on Tuesday, appreciating by 0.04%. By the close of trading, the local currency settled at 283.77 against the greenback, marking an improvement of 10 paisa from the previous session's close at 283.87. In the global market, the US dollar weakened while the Australian and New Zealand dollars strengthened after US President Donald Trump announced a ceasefire deal between Israel and Iran. The development boosted investor sentiment and triggered a risk rally across international markets. Moreover, Pakistan's broad money (M2) grew by 0.9% on a week-on-week (WoW) basis to Rs38.4 trillion as of June 13, 2025, according to data released by the State Bank of Pakistan (SBP). The increase was mainly driven by a 1% WoW rise in total deposits with banks, which climbed to Rs27.5 trillion. Meanwhile, currency in circulation (CIC) edged higher by 0.7% WoW, standing at Rs10.9 trillion. On a month-on-month (MoM) basis, the broad money expanded by 3.2% while year-on-year (YoY) growth stood at 11.6%. So far in 2025, M2 has posted an increase of 7.9%. Currency in circulation surged 5.3% MoM and 17.4% YoY, reflecting higher cash demand after Eid holidays. Total deposits grew 2.3% MoM and 9.6% YoY during the period. Other deposits with the SBP, however, declined 3.2% WoW and 13% MoM, marking a sharp 30.6% fall on a yearly basis.
Express Tribune
36 minutes ago
- Express Tribune
PSX soars as Middle East tensions ease
Listen to article Pakistan Stock Exchange (PSX) skyrocketed over 6,000 points on Tuesday as US President Donald Trump announced a ceasefire between Israel and Iran, bringing an end to regional hostilities. The benchmark KSE-100 index surged at the open, where bullish momentum drove it to the intra-day high of 122,725, up 6,557 points. As the session progressed, investor confidence strengthened, culminating in the KSE-30 index hitting its upper circuit breaker, a rare and historic moment that sent a wave of excitement. Market activity was further buoyed by renewed macroeconomic optimism, including news of Pakistan's plans to secure $3.3 billion in external financing from Chinese banks. Trading activity was robust, with 805 million shares changing hands valuing at Rs38 billion. At the end of trading, the KSE-100 index recorded an increase of 6,079.17 points, or 5.23%, and settled at 122,246.64. Arif Habib Limited (AHL) Deputy Head of Trading Ali Najib commented that regional peace ignited a rally at the PSX, which posted the second-highest surge of over 6,000 points in a day. The KSE-100 ended trading at 122,247 points by easily crossing the psychological barrier of 120,000. Earlier, the bourse opened on a strong note with an increase of over 4,000 points post-ceasefire between Iran and Israel. There was across-the-board stock buying, which lifted the benchmark index to the high of 122,725 in intra-day trading, he said. On the macro front, Najib pointed out, Pakistan plans to secure $3.3 billion via syndicated and refinanced commercial loans from Chinese banks, potentially boosting forex reserves to over $14 billion. "Now, all eyes are on the 130,000 index level by month end." Topline Securities, in its review, said that the local bourse opened with a bang as investors cheered the breakthrough ceasefire agreement between Israel and Iran, which brought a welcome pause to rising geopolitical tensions in the region. Riding on a wave of optimism, the KSE-100 index surged at the commencement of proceedings, clocking in an eye-popping 4,202-point jump. The bullish momentum intensified as the session progressed, culminating in a historic moment, when the KSE-30 index hit its upper circuit breaker, it said. The KSE-100 reached the intra-day high of 6,557 points, before settling at 122,247, up a whopping 6,079 points, or 5.23%. The brokerage house called it a remarkable session that reflected renewed investor confidence and the return of broader risk-on sentiment. Top contributors to the index were Lucky Cement, Engro Holdings, UBL, Pakistan Petroleum and Oil and Gas Development Company (OGDC), which collectively added 1,795 points. Pakistan State Oil (Rs2.4 billion), OGDC (Rs1.98 billion), Pakistan Petroleum (Rs1.62 billion), Lucky Cement (Rs1.60 billion) and DG Khan Cement (Rs1.49 billion) dominated in terms of traded value, signalling strong interest in key blue-chip and mid-cap names, Topline added. In its commentary, Arif Habib Limited (AHL) noted that diplomatic resolution to the Middle East conflict triggered a sharp rally in risk assets globally. At the PSX, 96 shares rose while two fell on the KSE-100. Earlier, trading was halted following a 5% rise for the index. Lucky Cement (+9.4%), Engro Holdings (+7.85%) and UBL (+4.29%) contributed the most to index gains, AHL observed. "Pakistan is aiming to secure $3.3 billion in two foreign loans – one a syndicated loan and the other refinancing of commercial loans – from Chinese banks. This will take State Bank's forex reserves above $14 billion in FY25," it said. "With the KSE-100 regaining its hold on the 120,000 range, 130,000 points comes back into focus." According to JS Global analyst Mubashir Anis Naviwala, the PSX soared as ceasefire in the Middle East triggered a buying spree. "Just seconds after the market halt ended, the KSE-100 index surged over 6,500 points, sparking widespread euphoria," he said. Bullish sentiment dominated the entire session, pushing the index to the intra-day high of 122,725. Investors jumped in across sectors, encouraged by signs of geopolitical de-escalation. "Near-term outlook remains positive, with fresh opportunities in cement, banking and fertiliser sectors," the analyst added. Overall trading volumes increased to 804.8 million shares compared with Monday's tally of 595 million. The value of shares traded was Rs37.6 billion. Shares of 477 companies were traded. Of these, 407 stocks closed higher, 35 fell and another 35 remained unchanged. WorldCall Telecom was the volume leader with trading in 65.4 million shares, gaining Rs0.11 to close at Rs1.46. It was followed by K-Electric with 54.3 million shares, gaining Rs0.35 to close at Rs5.24 and Cnergyico PK with 37.9 million shares, gaining Rs0.53 to close at Rs7.16. During the day, foreign investors sold shares worth Rs418 million, the National Clearing Company reported.
Business Recorder
an hour ago
- Business Recorder
Anatomy of the war and a steadfast Pakistan
The Israeli aggression against Iran launched only two days prior to the resumption of Iran-US talks on Iran's nuclear programme was intended to sabotage the talks and clear the way for an Israeli attack on Iran. Six factors regarding Israel's aggression are significant. First, it had the full backing of the Donald Trump's administration. Key Washington insiders plus Donald Trump himself publicly said they were told about the Israeli attack before it was launched. By all CNN and BBC accounts, the US President chaired a meeting two days prior to the Israeli attack at Camp David to clear the Tel Aviv attack plan with all his top advisors. Clearly, without the US clearance Israel could not have launched the attack since it was, as always, going to bank upon US military support. Second, the US-Iran talks were going well. In March, the head of US Intelligence Tulsi Gabbard had testified in a Congressional hearing that Iran was honoring its commitments made to the US and Ayatullah Ali Khamenai's 2003 public edict that Iran will not make a nuclear bomb was being followed by the Iranian government. She had said Iran is at least three years away from making a nuclear bomb. It was clear that Donald Trump with his key political and strategic partner, Israel, wanted to use force to attempt the impossible, i.e., complete destruction of Iran's nuclear programme. In his last Administration Trump had torn apart the JCPOA agreement in 2018 that the Obama administration in a 5 plus 1 framework had negotiated with Iran. Hence Trump was determined, irrespective of US's own intel conclusion that Iran must not have a nuclear programme. Evidently naïve in his understanding of Iran's determination regarding retaining a programme, he wanted Iran to give up its nuclear programme the way Kazakhstan, Belarus, Ukraine, and South Africa did. Third, the US and Israeli calculation was that with all their war machine, the unquestioned support of majority of western countries and their strategic partner India, Iran located in a stranglehold context with majority of the Gulf states not only offering tacit support to Israel and the US but also with 40,000 plus US troops and its multiple warships loaded with fourth and fifth generation fighter jets, etc., the Islamic republic would be an easy prey. Additionally, they were banking on Iranians to rise up against the current Iranian regime. Mossad and the CIA had been preparing the deposed Shah of Iran's son to come and take over after the regime collapse. He was regularly trying to beam messages to the Iranians, saying Israel is not against people, but against the 'horrible' government. A fanciful plan in which two days ago US administration reportedly had asked Elon Musk to manage digital penetration into Iran so the 'new' CIA-Mossad-Shah's message to 'his' people could be freely beamed throughout Iran. Fourth, the Iranian security and intelligence network had been penetrated for a while. In fact, the first was the top IGRC Commander in 2000. This time hence the beginning of the Iranian attack was synchronized with assassinating about ten top level nuclear scientists, several top commanders and Khamenei's top advisor. Such an across-the-board deadly massacre was calculated to have destroyed the will and the morale along with almost obliterating Iran's nuclear brains and the expertise. Fifth, the Trump administration along with Israelis had long planned to destroy current Iranian regime, not just the nuclear programme. The plan was to follow their earlier model of regime change and installation of pro-US-Israel regimes. Or, at least, non-confrontational regimes. As General Wellesely Clark pointed out that twenty plus years ago the plan was removal of 7 regimes. Iran was the last among those that had to be ambushed and destroyed. Sixth, the Israel-US joint plan was to use B2 bombers with bunker busting bombs to completely destroy or obliterate the nuclear sites. But this has not been achieved, according to even many noted American nuclear experts. After all what began during Trump's last administration as the Abraham Accords could not be implemented without destruction of this Iranian regime. A friendly and peaceful region that is conceived with Palestinians getting the statehood that multiple UNSC resolutions have committed to them would be viable but one that envisages genocide of the Palestinians that we are witnessing cannot be viable. Israel-US plan masterminded by the US strategic guru, a brilliant mind and a pro-Zionist ideologically, had conceived through salami tactics to divide and conquer politically, economically and strategically the Arab world where the Greater Israel plan could be comfortably planted. Iran fought back, did not buckle under pressure, wasn't defeated through surprise, deception, war machine, destruction within, deaths of its civilians and much more. The war has left Iran in a very difficult position, economically especially. However, Iran's very costly but heroic survival despite the multiple force and multiple nation' onslaught means, for now at least, the last bastion against US and Israel domination is still in place. For Iran diplomacy was never on offer. All the talk by the Trump administration for diplomacy, peace and negotiations was meant to deflect from the harsh reality that Iran was being bombed to surrender. The occasionally candid Trump even messaged on X unconditional surrender! Israel has been defeated in a war that it arrogantly and confidently began with the total military, diplomatic and political support of the United States, India and almost all the western countries. Iran has won the war! This is the most significant victory in the last half a century of any country against Israel and the bunch of it backers. And, the victor happens to be a non-Arab Islamic country, the Islamic Republic of Iran. Israel's genocide in Gaza now needs to be stopped through action, not words alone. Meanwhile, Pakistan has again demonstrated that we follow the legacy of the founder of the nation. In the true spirit of our Quaid, who valiantly stood up for Palestinian rights when Pakistan was not even 6-month-old, each and every government of Pakistan has largely stood for the rights of Islamic countries. And so did this government. Pakistan without reference to Iran's track on supporting Pakistan when Pakistan's genuine friends should have, Pakistan led from the front in rallying diplomatic support for Iran. Pakistan took a bold and principled stance against Israeli aggression from the moment Israel, backed by the US, India and most western capitals, consistently aggressed against Iran. Whether in Pakistan, New York or DC, all of Pakistan's top office holders and military commanders condemned Israeli attacks on Iran in violation of all rules and norms of international law. Pakistan condemned US by name in its official statement for attacking Iran's nuclear sites in violation of international law. Iran's realpolitik manual would do well to include the principle that only real friends show up in crisis! And meanwhile Pakistan must be more mindful of handing out Nobel Prize nominations! Copyright Business Recorder, 2025
