Oil prices are falling on global markets: the main reasons
16 June 09:36
Oil prices are falling moderately on Tuesday, June 16, after dropping to their lowest levels since early March the previous day amid expectations that the conflict in the Middle East is coming to an end. This is reported by "Komersant Ukrainian" citing Interfax-Ukraine.
August Brent futures on the London ICE Futures exchange were trading at $82.78 per barrel as of 8:09 a.m., down $0.39 (0.47%) from the previous session’s close. On Monday, these contracts fell by $4.16 (4.76%) to $83.17 per barrel.
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Prices for July WTI crude oil futures on the New York Mercantile Exchange (NYMEX) have fallen by $0.17 (0.21%) to $80.58 per barrel. At the close of the previous session, their price had fallen by $4.13 (4.87%) to $80.75 per barrel.
U.S. President Donald Trump, Vice President J.D. Vance, and Iranian Parliament Speaker Mohammad-Bagher Ghalibaf signed a memorandum in electronic format to begin resolving the Middle East crisis, the Axios portal reported on Monday, citing a source. The official signing ceremony is expected to take place on June 19.
Meanwhile, following talks with French President Emmanuel Macron, the White House chief stated that the Strait of Hormuz is already partially open and will be fully open on Friday. Trump also noted that no tolls will be charged for ships passing through this waterway.
Market participants are awaiting the release of the memorandum’s details and assessing the timeline for the normalization of oil supplies from the Persian Gulf countries.
“Until the details become clear, the market will likely remain cautious about further reductions in the risk premium,” says KCM Trade analyst Tim Waterer.
IG expert Tony Sycamore, in turn, notes that restoring energy supplies to pre-crisis levels will be no easy task.
“Clearing mines, restoring full insurance coverage for maritime transport, and ensuring sufficiently safe conditions for ships and operators to return to the Gulf will take time—as will the restoration of suspended production and damaged regional infrastructure,” he writes.
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