Oil Prices Drop After Israel-Iran Ceasefire
(MENAFN) Oil prices dropped by more than 12% last week, breaking a three-week surge, with experts forecasting prices to stabilize near the $60 mark if the fragile ceasefire between Israel and Iran holds.
Brent crude surged to $77.81 a barrel on June 23, following U.S. airstrikes on Iranian nuclear sites, briefly reaching a five-month high. However, prices plummeted 8.5% in a single day to $69.48 after Iran’s retaliatory attack on a U.S. base in Qatar was seen as limited in scale. This sharp decline marked Brent's largest single-day loss since July 2022.
The downward momentum intensified following June 24, when reports of a ceasefire between Israel and Iran raised hopes of uninterrupted oil shipments through the Strait of Hormuz, a vital route that carries roughly 20 million barrels of crude and petroleum products daily.
By June 27, Brent crude had fallen 12.6% to $66.33 a barrel, marking its steepest weekly drop since March 2023.
Despite recent volatility, experts predict that oil prices will stabilize around the $60 level in the near term, as geopolitical risks ease and supply-demand fundamentals regain control.
OPEC+ Meeting to Set Course for Oil Prices
The future of oil prices will largely depend on decisions made at the upcoming OPEC+ meeting, which includes OPEC members and other non-OPEC oil producers, according to Ajay Parmar, director of Oil Markets and Energy Transition at Independent Commodity Intelligence Services (ICIS), speaking with media.
Parmar anticipates prices will stabilize near current levels until clearer direction is provided by OPEC+ after their production discussions on July 6.
He noted that if OPEC+ opts to boost supplies, prices could slide back to the mid-$60 range.
Parmar also pointed out that efforts by U.S. President Donald Trump to drive prices lower have had minimal effect, emphasizing that seasonal demand is providing support for current price levels.
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