FX.co ★ Oil Prices Cut Gains

West Texas Intermediate (WTI) crude oil futures declined to approximately $73 per barrel, as initial concerns about significant supply disruptions stemming from the Middle East began to dissipate. Investors recognized that there was no immediate effect on the actual flow of oil following United States strikes on Iranian nuclear sites. Although Israel intensified its offensive and Iran pledged to retaliate, the gravity of Iran’s response appears to be decreasing. Despite the Middle East accounting for a third of the world's crude oil production, oil shipments, including those through the crucial Strait of Hormuz, remain unimpeded. In fact, there have been indications that Iranian oil exports have increased since the outbreak of the conflict. Previously, WTI prices had surged to as much as $74.3 per barrel, marking the highest level since January. This upswing was reversed as the market reconsidered the likelihood of immediate disruption and awaited Iran's subsequent actions.