Brent crude futures for the March contract are down over 2.5% and have slid below the mark of $65 per barrel, while West Texas Intermediate or NYMEX also fell by a similar quantum in early Asian trading.
Speaking to reporters, Trump said that he has been assured of Iran stopping the killing of protestors, reducing the probability of an immediate US military response to the demonstrations against Supreme leader Ayatollah Ali Khamenei, causing potential disruptions to Iran’s production and shipping lanes.
Oil prices are recovering from multi-year lows at the start of the new year led by the issues in Iran, the fourth-largest producer in the OPEC+, along with the Venezuela crisis, following five consecutive months of losses on expectations of a supply glut in 2026.
Trump also said that he had a “very good call” with acting Venezuela President Delcy Rodriguez, which also included subjects like oil.
US government data showed that crude stockpiles rose 3.4 million barrels last week, the highest build-up since early November, pressuring prices further.
“Geopolitically induced strength in Brent likely continues, and a test up to $75 is certainly possible,” said Robert Rennie, the head of commodity research at Westpac Banking Corp. The rally may be followed by a collapse when the ‘all-clear is sounded’ or Khamenei’s regime crumbles, similar to the market movement during the Iran-Israel conflict in June,” he said.
(With Inputs From Agencies)
