Global oil prices fell sharply to around $91 per barrel on Tuesday after soaring to a more than three-year high the previous day, as United States President Donald Trump suggested the ongoing Middle East conflict could end sooner than expected. The comments eased market fears that the war would severely disrupt global oil supplies for an extended period.
According to Reuters, Brent crude futures dropped by $7.15, or about 7.2 percent, to $91.81 per barrel, while U.S. West Texas Intermediate (WTI) crude fell by $6.26, or 6.6 percent, to $88.51 per barrel. Both oil benchmarks had earlier plunged by as much as 11 percent during the trading session as investors reacted quickly to the shift in geopolitical expectations.
Oil markets had surged on Monday, with prices climbing above $119 per barrel — the highest level since mid-2022 — amid fears that escalating tensions involving Iran, Israel, and the United States could disrupt supply from the Middle East. Concerns grew after shipping activity around the strategic Strait of Hormuz, which handles roughly one-fifth of the world’s oil supply, was severely affected.
However, markets cooled after Trump said in a CBS interview that the war against Iran appeared to be nearing completion and was progressing much faster than initially expected. Analysts noted that the remarks calmed investors who had previously pushed oil prices higher due to fears of a prolonged conflict. Suvro Sarkar, energy sector team lead at DBS Bank, said markets may have overreacted to both the earlier surge and the latest decline in prices.
Despite the price drop, tensions remain high. Iran’s Revolutionary Guards warned they would block oil shipments from the Middle East if U.S. and Israeli attacks continue, while Trump warned Washington would respond with stronger military action if tanker traffic were obstructed. The situation remains fluid, especially following the appointment of Mojtaba Khamenei as Iran’s new supreme leader, succeeding Ali Khamenei, a move analysts say could signal a more hardline stance during the ongoing crisis.
source: nairametrics