WASHINGTON (dpa-AFX) - Crude oil prices have tumbled on Tuesday as optimism about a U.S.-Iran peace deal that could lead to reopening of the Strait of Hormuz soon grows despite reports of fresh U.S. strikes on Iran yesterday.
WTI Crude Oil for July month delivery was last seen trading down by $2.72 (or 2.82%) at $93.88 per barrel.
The U.S.-Israel versus Iran war is nearing the end of third month.
Since the start of the war, the Strait of Hormuz remains blocked for oil and energy vessels from Arab nations.
Early in April, U.S. President Donald Trump announced a ceasefire with an intention to allow time for negotiations.
Last week, Trump stated that talks proceeded well but warned that if war resumes, it will be stronger than before.
On Sunday, Trump remarked that negotiations were going on in an orderly manner but observed that he had asked his representatives not to rush into a deal.
Trump raised a new demand whereby he asked several Arab nations to come together to sign the Abraham Accords and make the settlement with Iran historically significant.
The accord was brought out during Trump's first term to end hostilities between the Arab countries and Israel.
While the Iranian regime is resisting the U.S. moves to halt Iran's nuclear ambitions, Trump ruled out allowing Iran to develop or procure any nuclear weapon.
Yesterday, U.S. Secretary of State Macro Rubio stated that he expected some good news though Iran clarified that though talks are progressing well a deal is not imminent.
An Iranian team comprising high-profile ministers and high-level officials arrived in Qatar yesterday to discuss delicate issues before finalizing a peace agreement.
Nikkei reported that once a deal was made, Iran would clear the mines from the Strait of Hormuz to allow for safe, free, and toll-free shipping, and added that the ceasefire would be extended for 60 days to discuss Iran's nuclear programs.
Today, through Truth Social, Trump insisted that Iran's enriched uranium must be brought out and destroyed safely, either in the U.S. or any other location acceptable to Iran.
Yesterday, a Spokesperson for U.S. Central Command, Navy Captain Tim Hawkins stated that U.S. forces conducted limited 'self-defense' strikes against Iran, but he confirmed that that U.S. navy exercised restraint due to the ongoing ceasefire.
The attacks targeted Iran's boats trying to emplace mines and missile launching sites near the port city of Bandar Abbas in southern Iran. Iran accused the U.S. of showing a sign of bad faith and unreliability.
Against this backdrop, Iran's Supreme Leader Mojtaba Khamanei messaged to Iranians that gulf powers will no longer serve as a shield for U.S. bases and Israel will not exist in another 15 years.
For the second day today, talks continued in Qatar hinting that neither side have abandoned pursuing diplomatic solutions to end the hostilities.
Today, Rubio stated that it may take a few more days before a final deal is reached as it involves a lot of talking back and forth. However, he reaffirmed that the Strait of Hormuz will reopen one way or other and called the closure 'unsustainable'.
Fox News confirmed an earlier New York Post news that Trump is set to convene a rare Camp David Cabinet meeting on Wednesday to weigh the next steps in high-stakes negotiations aimed at securing a broader agreement with Iran.
Despite the uncertainty on a U.S.-Iran agreement, market participants anticipate that both nations would strike a deal and avert a war as inflationary pressures due to closure of the Strait of Hormuz continue to grow.
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