Business Recorder

Oil prices fall to seven-week low

NEW YORK: Oil prices fell about 3 percent to a seven-week low on Tuesday after Iran and Israel said they had halted attacks on each other following an appeal from US President Donald Trump. Trump said Iran shot down a US helicopter in the Strait of Hormuz and he threatened that Washington would respond. Oil prices bounced off session lows following his remarks. Brent futures fell USD2.80, or 3.0 percent, to settle at USD91.45 a barrel. US West Texas Intermediate (WTI) crude slid USD3.10, or 3.4 percent, to settle at $88.20. It was the lowest settlement for Brent since April 17 and for WTI since May 29. It was also the first time since January that Brent closed below its 100-day moving average of technical support. “The oil market is drafting lower … as the latest shooting match between Israel and Iran was in favor of a ceasefire and as Trump continues to talk the market lower by suggesting that an end of the war with Iran could be reached in 2-3 days with negotiations in their final stages,” analysts at energy advisory firm Ritterbusch and Associates said in a note. READ MORE: Oil prices fall 4% to seven-week low as Iran and Israel halt attacks On Monday, Israel and Iran halted direct attacks on each other after Trump urged them to stop. Tehran said it would resume hostilities if Israel continued to attack the Hezbollah militia in Lebanon. Iran has so far held back from attacking even though Israel struck the historic port city of Tyre in southern Lebanon, killing at least eight people. Iran, meanwhile, continued to block most shipping through the Strait of Hormuz, which before the war carried a fifth of the world’s crude oil and liquefied natural gas. Washington has imposed its own blockade of Iranian ports. US Energy Secretary Chris Wright said on Tuesday that ship traffic in the Gulf and oil exports through the Strait of Hormuz are rising even as Washington and Tehran struggle to reach a deal on ending their more than three-month-old war. Elsewhere around the world, China’s May crude imports slumped 29 percent to their lowest level in eight years, extending a sharp decline in the world’s largest oil importer that is helping keep a lid on global oil prices.

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