Global oil prices dropped after hitting a four-year high of more than $126 a barrel on Thursday, driven by concerns that the US-Iran conflict could escalate and lead to a prolonged disruption of Middle East oil supply, potentially harming global economic growth.
Brent Crude Futures Decline
Global oil benchmark Brent crude futures were down $1.51, or 1.28 percent, to $116.50 a barrel as of 1.47 p.m. Saudi time. Earlier in the session, prices touched an intraday high of $126.41, the highest level since March 9, 2022. The prompt contract for June delivery expires on Thursday.
Market Reactions to Geopolitical Tensions
The market initially moved higher after Axios, citing unidentified sources, reported late on Wednesday that US President Donald Trump is scheduled to receive a briefing on Thursday regarding plans for a series of military strikes on Iran, in hopes that it will return to negotiations on its nuclear program. However, prices later dropped without any obvious catalyst. The declines reduced after Iran's supreme leader issued a statement saying the new management of the Strait of Hormuz 'will bring calm and progress' as well as 'economic benefits' to all Gulf nations, according to Reuters.
Trading Activity
Two large sell orders for June Brent traded shortly before 11.30 a.m. Saudi time, traders noted, and LSEG data showed. The market remains volatile amid ongoing geopolitical uncertainties.
