Quick overview

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Oil prices fell Tuesday to their lowest point in over a week as President Donald Trump announced that Iran and Israel reached a ceasefire, allaying fears of a disruption in the region’s oil supply.

Brent crude futures dropped $68.79 a barrel, after plunging over 4% earlier in the day and hitting its lowest level since June 11.

West Texas Intermediate crude fell to $65.46 per barrel after plunging about 6% to its lowest level since June 9 earlier in the day.

Trump declared that Israel and Iran had reached a complete agreement on a ceasefire, with Iran initiating the ceasefire right away and Israel following 12 hours later.

A 12-day conflict could end within 24 hours if both sides commit to maintaining peace. It was stated that the conflict between the two countries would conclude once the ceasefire is fully implemented. As the third-largest producer of crude oil in OPEC, Iran would benefit from a reduction in tensions.

The Oil market faced headwinds  following Trump’s social media post warning of rising oil prices and urging the Energy Department to allow more drilling “right away.” “We’re on it,” the agency  said

Energy Secretary Chris Wright. Since Israel targeted Iran more than a week ago, the oil market has been in a worsening crisis, with crude benchmarks rising, options volumes surging, and the futures curve shifting to reflect fears of a short-term supply disruption.

The US crude prompt spread, the difference between its two nearest contracts, rose from $1.18 on Friday to $2.24 per barrel in a bullish backwardation structure. The closely monitored metric later retraced a significant portion of that movement. The historic US strikes were intended to impede Iran’s nuclear program.