Key facts
- Oil prices fell around 3% on Thursday.
- Hopes for a U.S.-Iran deal followed a ceasefire between Israel and Lebanon.
- A potential deal could lead to the reopening of the Strait of Hormuz.
- Brent futures settled down 2.84% at $95.03 a barrel.
- U.S. West Texas Intermediate crude settled down 3.1% at $93.04.
- U.S. crude stockpiles fell by 8 million barrels in the week ended May 29.
Oil prices settled around 3% lower on Thursday as investor hopes for an end to U.S.-Iran tensions, following a ceasefire deal between Israel and Lebanon, raised expectations for the reopening of the Strait of Hormuz. Brent futures settled down 2.84% at $95.03 a barrel, and U.S. West Texas Intermediate crude settled down 3.1% at $93.04. Analysts noted that market worries about supply disruptions are currently being overshadowed by optimism for a diplomatic solution. The market had previously risen due to renewed Middle East hostilities. In the U.S., the House of Representatives approved a resolution to block President Trump from continuing the war against Iran, though it faces hurdles in the Senate and a potential veto. Russian oil production has reportedly decreased since the start of the year due to refinery maintenance. Meanwhile, U.S. crude inventories saw a larger-than-expected drop of 8 million barrels for the week ended May 29. OPEC maintained its robust oil demand growth forecast.