(Bloomberg) – Oil slumped after President Donald Trump signaled a decision on whether to strike Iran will be made within two weeks, easing fears about an imminent attack from the U.S.
“Easing fears of U.S. strikes, the absence of major oil supply disruptions, and ongoing demand risks can push crude prices lower,” commented Nikos Tzabouras, Senior Market Analyst at Tradu.com. “However, the current environment favors elevated prices and keeps the road open to new 2025 highs. Hostilities between Israel and Iran have entered their second week and the prospect of U.S. involvement persists, sustaining geopolitical uncertainty and supply risks.”
Brent tumbled as much as 4.2% to trade below $76 a barrel, the loss deepening after Reuters reported Tehran is ready to discuss limitations on its uranium enrichment. Iran’s Foreign Minister Abbas Araghchi is scheduled to meet counterparts from the UK, France and Germany later Friday in Geneva. Those talks will be “limited to nuclear and regional issues,” he said in an interview with state television.
Trump’s decision on Iran will take some time due to the “substantial chance of negotiations,” he said in a message through White House spokeswoman Karoline Leavitt.
It’s been a turbulent week for the oil market, with futures swinging in a range of around $8, volatility spiking to the highest since 2022, key premiums significantly widening and options at one stage more bullish than after Russia’s invasion of Ukraine.
Brent closed almost 3% higher on Thursday in a trading session that was shortened due to a U.S. holiday, on concerns over a potential strike from the U.S. over the weekend. Senior American officials had been preparing for the possibility of an attack, although the situation was still evolving, people familiar with the matter said.
Israel has continued to attack Iran’s nuclear sites, but for now the country’s crude-exporting infrastructure remains unscathed. There are signs, however, that the OPEC producer is racing to get its oil out into the world as storage tanks at the critical Kharg Island export terminal brim with crude.
The biggest concern for the oil market centers on the Strait of Hormuz, but so far there are no signs that Tehran is seeking to disrupt shipping through the narrow waterway at the entrance to the Persian Gulf. About a fifth of the world’s crude output passes through the strait.
Trump is set to attend a National Security meeting Friday morning, according to a daily schedule issued by the White House. Iran should never get a nuclear weapon, US Secretary of State Marco Rubio said in a post on X following a meeting with UK Foreign Secretary David Lammy to discuss the conflict.
This article was originally posted at www.worldoil.com
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