Oil Prices Stable, Market Warns of Trump's New Threat to Iran
Oil prices moved relatively stable as market participants weighed President Donald Trump's latest threat to strike again against Iran. Brent fell slightly to below $111/barrel, while WTI held around $104/barrel, after both weakened in the previous session.
Trump said that if Tehran does not agree to US peace terms, America "may have to deal another big blow." This statement again opened the door to escalation, but the market also remembered a recurring pattern: threats emerge, then subside. As a result, many traders were reluctant to add to bullish positions without strong evidence that the conflict was truly reactivated.
On the fundamental side, disruptions to energy flows remain key. The war, now in its 12th week, is said to be stifling traffic in the Strait of Hormuz, boosting global energy prices and maintaining inflationary pressures. The US also reportedly seized an Iran-linked tanker in the Indian Ocean, adding to the supply risk factor in the sea lane.
At the same time, there are signs that could reduce the risk premium if realized. NATO is said to be discussing the option of escorting ships if the route remains closed past early July. If these measures are effective, supply could return to normal sooner than expected by some market participants who have already priced in longer closures.
From the US side, industry reports showed crude oil stocks fell by 9.1 million barrels last week, which, if confirmed by official data, could be the largest decline since September. The market is also watching for unusual options flows, including a large transaction of Brent put options equivalent to 134 million barrels, raising concerns about sudden volatility.
5 key points:
- Brent around $110.72 and WTI $103.82; prices tending to be stable.
- The market is weighing Trump's new threats but remains hesitant due to frequent fluctuations.
- The Strait of Hormuz remains blocked, containing supply risks and inflationary pressures.
- The NATO security option could lower the risk premium if supply returns to normal.
- Newsmaker assesses that the future direction of oil will be determined by geopolitical headlines and real supply conditions. An escalation of conflict or disruption to shipping could potentially increase volatility and support prices. If access to Hormuz improves, the risk premium could shrink. The market is also awaiting official US stockpile data, the US stance on exports, and large options flows that could trigger rapid movements. (Asd)*
Source: Newsmaker.id
