In this post:
- After the White House postponed making a decision on US engagement in the Israel-Iran conflict, Brent crude futures dropped $1.89 a barrel to $76.96.
- July U.S. WTI futures increased by $0.53 per barrel to $75.67.
- As investors considered President Trump’s two-week deadline, US stock futures fell more than 0.3 percent.
After the White House postponed its decision on US engagement in the Israel-Iran conflict, Brent crude prices fell about $2 on Friday, reversing a recent rise.
Brent oil futures were down $1.89, or 2.4%, at $76.96 a barrel at 02:55 GMT, but they were still up roughly 3.8% for the week.
A holiday prevented Thursday’s trading of US West Texas Intermediate crude for July, but it was up $0.53, or 0.7%, at $75.67 per barrel.
Prices rose by about 3% earlier Thursday after Israel hit what it claimed were nuclear-related sites in Iran. Iran then attacked Israel with missiles and drones after an overnight raid on an Israeli hospital. The week-old clash between the two countries showed no signs of easing.
Gains were curtailed on Friday, though, when the White House press secretary stated that President Donald Trump would make a decision on whether to deploy American military to the Israel-Iran conflict within the next two weeks.
Fears of more U.S. engagement in Israel’s war with Iran caused oil prices to soar. However, Phil Flynn, an analyst with The Price Futures Group, later stated that the White House press secretary indicated there was still opportunity for de-escalation.
Iran, a member of the Organization of the Petroleum Exporting Countries, is the third-largest producer in the group, extracting over 3.3 million barrels of crude oil per day.
Oil and oil products flow through the Strait of Hormuz on Iran’s southern coast at a rate of between 18 million to 21 million barrels per day. Analysts and traders fear that if the war intensifies, it may impede shipments and reduce international supply.
Trump has employed the “two-week deadline” strategy in other significant choices. Tony Sycamore, an analyst at IG, pointed out that these deadlines frequently pass without any significant action, which would keep the price of crude oil high and maybe build on recent gains.
Thursday night saw a decline in US stock futures
Thursday night saw a decline in US market futures as investors considered the possibility of US military engagement in the Israel-Iran conflict and President Trump’s two-week deadline for a decision.
Futures for the S&P 500 and Nasdaq 100 fell about 0.3%, while futures for the Dow Jones Industrial Average lost more than 0.4%.
Due to Thursday’s Juneteenth market closure, traders took a break as tensions in world headlines increased.Investors on Wall Street were also processing comments made by Jerome Powell, the chair of the Federal Reserve.
Powell stated that policymakers were not in a rush to lower interest rates and would base their decisions on new evidence after the Fed held interest rates steady on Wednesday.
The majority of traders anticipate a rate cut by the Fed’s September meeting, according to CME Group.
Powell was once again criticized by President Trump on Thursday, who said that by maintaining high interest rates, Powell has cost the US “hundreds of billions of dollars.” Powell was referred to as “one of the dumbest, and most destructive, people in Government” in his personal attack.
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