The fire of war stopped due to a decision of Trump: Brent crude fell below $88, know whether oil will become cheaper now?

Crude oil prices are continuously softening in the international market as there are clear signs of reducing military tension between America and Iran in West Asia (Middle East). The price of global standard Brent Crude has slipped below $88 per barrel, while the price of American West Texas Intermediate (WTI) has also fallen to around $82 per barrel. New hopes have arisen to resolve the dispute between the two countries through diplomatic channels. According to Axios report, US President Donald Trump has clarified that he decided to stop the ongoing bombing and military attacks against Iran in order to give talks another chance. He said that talks with Tehran are going on in a positive direction. However, diplomatic analysts say that any final conclusion is yet to be reached between the two countries. There was huge volatility in crude oil prices throughout this month, when the rates had increased rapidly due to the dispute between Washington and Tehran spreading to the Red Sea, but now due to the pause in military activities, the prices are coming down rapidly.

Important meeting between Oman and Iran in Tehran, initiative to open sea routes

According to a Bloomberg report, intense discussions are underway between top officials of Iran and Oman to restore the safe movement of oil tankers through the strategic waterway linking the Persian Gulf to the international market. This sea route handles about 20% (one fifth) of the world’s total daily oil transport under normal circumstances. Sources related to the matter say that an important meeting of senior military and administrative officials of Oman and Iran was held in Tehran over the weekend. If this arrangement, brokered by Oman, proves effective, the US and Iran could return to the formal negotiating table to resolve their longstanding differences. Amidst this positive environment, the Iranian Army has also officially announced that it has completely stopped all retaliatory actions taken by it against American soldiers and their military bases located in the region.

Loading resumed at Kazakhstan terminal, supply chain problems resolved

Not only the peace in the Middle East but also the improvement in global oil supply is a major reason behind this decline in the international price of crude oil. The blockage at Kazakhstan’s main export terminal caused by recent Ukrainian drone attacks has now been resolved. According to information provided by the Energy Ministry of Kazakhstan, the loading process of two huge oil tankers has been restarted at the ‘Caspian Pipeline Consortium’ (CPC) facility located near Novorossiysk Port in Russia. With the commencement of this supply, the fear of shortage of crude oil in the international energy market has ended, due to which it is expected that there will be more stability and relief in global oil prices in the coming days.