Brent slips as Israel-Iran ceasefire eases market tensions
The front-month ICE Brent contract lost by $0.47/bbl on the day, to trade at $67.55/bbl at 09.00 GMT.
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Upward pressure:
Brent crude’s price regained some value after the US Energy Information Administration (EIA) released crude stocks data.
Commercial US crude oil inventories plunged 5.8 million bbls lower to touch 415 million bbls for the week ending 20 June, according to data from the EIA.
The EIA report was “bullish”, Vanda Insights’ founder and analyst Vandana Hari remarked.
A drop in US crude stockpiles generally signals stronger demand and can provide some support to Brent's price.
“US government [EIA] data showed the US driving season is in full swing after a slow start,” ANZ Bank’s senior commodity strategist Daniel Hynes said.
Downward pressure:
Brent has continued to decline following the US-brokered ceasefire deal between Israel and Iran, which came into effect on Monday.
The news has wiped out the Mideast geopolitical risk premium from the market, according to analysts. It has “sent oil prices tumbling this week, as traders and investors bet the bombing campaigns are over,” analysts from ING Bank noted.
US President Donald Trump is confident that the ceasefire will remain in place, he told reporters at the recent NATO summit in the Netherlands,
Oil is down due to “lingering concerns over the stability of the Israel-Iran truce,” Hari said.
By Aparupa Mazumder
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