Shut down transaction 25/5, Brent oil prices dropped 7.2% to 96.1 a barrel. US WTI crude oil loses more than 6%, about nearly 91 a barrel. The first-week transaction mass was quite thin, due to early American markets.
The market came down as the optimistic investor that the US and Iran were approaching a peace agreement to reopen the Hormuz Channel. *Reuters quoted close sources stating that the Iranian foreign minister and chief of negotiations of the country had come to Doha to meet the Prime Minister of Qatar, in order to discuss a potential agreement with the US, through which the war ended for three months.
The party said that there had been progress on a memorandum intended to cease the war, at the same time facilitated the negotiations to have another 60 days to reach the final agreement.
However, the US's raiding of Iran at dawn 26/5 caused the price of oil to rise again. Brent Oil currently increased 2% to 98.1 dollars a barrel. The WTI oil moves slightly up to 91,8 dollars.
Rory Johnston - founder of the Commodity Context News again proved cautious. "For the past few months, we've been getting very close to the deal, and then we've broken up with the details. Hormuz Sea Ego is currently closed", Johnston said.
- Mohammad turned the price of Brent oil over the past year. Graph: Trading Economics*
In the Times Social Network articles Truth Social on May 25, U.S. President Trump said the negotiations with Iran were going on "good", but warning America could further attack if negotiations failed. He also called for more Arab and Muslim countries to join Abraham's Treaty. The agreement was prompted in his first term, for normalization of Israel's relations with Arab countries and countries with the majority of Muslim populations.
The Iranian Ministry of Foreign Affairs on May 25, states that the country is negotiating to end the conflict and is currently not discussing nuclear issues.
Even when the peace agreement was reached, analysts claimed that it would take months to move oil through the new Hormuz Channel to return to normal, due to damaged oil facilities that needed repair time.
"The shortage of supplies around 10-11 million barrels of oil per day will not be able to disappear immediately. The market will still have to continue using storage oil until production in the restored Middle East", June Goh - analyst at Sparta Commodities said.
"We still think that the most important factor with the oil market is the actual flow. And so far, the movement across the Hormuz Channel remains restricted", Giovanni Staunov - analyst at the UBS remarked.
The seaboat tracking data shows that in the past few days, three naturalized gas carriers (LNG) have passed the Hormberg Channel to Pakistan, China and India. In addition, a super oil carrier of Iraq to China has also moved after being stuck here for nearly three months.