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EMEA Oil Update: Crude Extends Loss After Trump Cancels Iran Strikes

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Global oil benchmarks slumped on Friday after US President Donald Trump claimed an imminent weekend peace deal would reopen the Strait of Hormuz, unwinding geopolitical risk premiums despite zero official confirmation from Tehran.

Front-month Murban crude futures tumbled 2.2% to $85.74 per barrel, while Brent futures retreated by 2.3% to $88.29/bbl.

The sudden reversal was triggered by US President Donald Trump's announcement during an Oval Office interaction that Washington has reached a "great settlement" to end the war with Iran.

"We just made a great settlement of the war with Iran, and we're going to be subject to finalization of documents," Trump said.

ING analysts said, "The price action in oil markets is no surprise, with Brent falling below $90/bbl on the latest developments. The relatively benign price action in recent weeks masks the scale of the supply disruptions from the Persian Gulf."

"We believe the market reaches an inflection point in late July if we do not see oil flows resuming before then. This is when inventory levels and seasonally stronger demand push prices significantly higher towards $120-130/bbl," ING analysts added.

Earlier, Trump confirmed he canceled the scheduled Thursday night strikes following high-level discussions with Iranian leadership, adding that a formal treaty could be finalized and signed in Europe as early as this weekend.

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