Oil price today: Crude slides 6% after touching nearly $120 as Trump signals Iran war may end

Oil prices relaxed on Tuesday after jumping past the $100-per-barrel mark a day earlier. The pullback came as fears of long-lasting supply disruptions eased slightly, with signs that the Middle East conflict could see some diplomatic movement.

As of 0018 GMT, Brent crude futures were down $6.51, or 6.6%, to $92.45 a barrel, while US West Texas Intermediate (WTI) crude dropped $6.12, or 6.5%, to $88.65.The decline comes after a sharp rally on Monday when oil prices jumped almost 30%, crossing the $100-a-barrel mark. During the session, Brent climbed to $119.50 and WTI touched $119.48, the highest levels seen since mid-2022. The spike came as concerns over energy flow rose as Saudi Arabia and other producers moved to cut supply amid the expanding US-Israeli war with Iran, fuelling worries about a significant disruption to global oil flows.

However, the rally lost momentum after Russian President Vladimir Putin held a call with US President Donald Trump and presented proposals aimed towards bringing about a swift settlement to the war involving Iran, Reuters reported, citing a Kremlin aide. Trump also signalled optimism about the conflict’s trajectory. In an interview with CBS News, he said that the war against Iran “is very complete” and that Washington was “very far ahead” of the four- to five-week timeline he had initially projected.

In response, Iran’s Revolutionary Guards (IRGC) said that they would “determine the end of the war” and warned that Tehran would not allow “one litre of oil” to be exported from the region if US and Israeli strikes continued. Despite the warning, oil prices eased as markets weighed other possible measures being considered in Washington. According to multiple sources, Trump is exploring options such as easing oil sanctions on Russia and releasing emergency crude stockpiles to help contain rising global oil prices linked to the Iran conflict.Market analysts warned that price swings could continue in the near term. “Taking the events of the past 24 hours into account, I expect crude oil to remain highly volatile, trading within a wide range between $75ish and $105ish in the sessions ahead,” Tony Sycamore, IG market analyst, said in a note, as cited by Reuters.At the same time, production cuts are beginning to emerge across Gulf producers as the US-Israeli war with Iran disrupts shipping routes in the region.

Iraq over the weekend slashed output at its key southern oilfields by 70%, bringing production down to 1.3 million barrels per day. Kuwait Petroleum Corporation has also started reducing output and declared force majeure.Saudi Arabia has likewise begun trimming production, sources said on Monday.Meanwhile, G7 countries said they were ready to take “necessary measures” to address surging global oil prices, although the group stopped short of committing to the release of emergency reserves.