West Texas Intermediate (WTI) crude oil prices declined to around $87.60 per barrel during European trading hours on Thursday, paring gains from the previous day [1]. The drop followed the US military's announcement that it had completed its latest strikes on Iran, which raised hopes that peace negotiations between the US and Iran could resume and helped ease concerns about oil supply disruptions [1]. According to a CNN report cited in the article, a diplomatic source confirmed that US-Iran negotiations toward a peace deal remain intact [1]. However, The Guardian reported that the Iranian Foreign Ministry condemned the overnight US strikes, calling them 'illegal and criminal' and stating that the attacks rendered the April 8 ceasefire 'practically meaningless' [1].
Geopolitical tensions remained high as the Israeli military's Home Front Command issued early warnings after rocket launches from Lebanon toward northern Israel, keeping markets on edge [1]. This escalation followed fresh US attacks on Iran, which were reportedly in response to accusations by President Trump that Tehran was intentionally delaying talks over an interim peace agreement [1].
On the supply side, the US Energy Information Administration (EIA) reported a significant drop in domestic crude inventories, which fell by 7.2 million barrels last week—well above the 4-million-barrel draw projected by analysts in a Reuters poll [1]. This decline brought the Strategic Petroleum Reserve (SPR) down to its lowest levels since August 2023 [1]. In response, the US Department of Energy announced plans to loan energy companies up to 40 million barrels of crude oil from the depleted reserve in an effort to curb rising fuel costs [1].
The combination of ongoing geopolitical risks and tightening US crude inventories has contributed to volatility in oil prices, with market participants closely monitoring developments in US-Iran relations and regional security dynamics [1].
CONCLUSION
WTI oil prices have retreated amid hopes for resumed US-Iran negotiations, despite ongoing regional tensions and a sharp drop in US crude inventories. The US government's move to loan crude from the Strategic Petroleum Reserve highlights efforts to stabilize the market. Investors remain cautious as geopolitical risks and supply concerns continue to influence oil price movements.