Oil prices eased on Wednesday, slipping around 1 percent as remarks from US President Donald Trump suggested the conflict with Iran could end soon. However, uncertainty over peace talks and ongoing risks to Middle Eastern supply kept traders cautious.
Brent crude futures fell $1.11, or 1.0 percent, to $110.17 a barrel at 0640 GMT. US West Texas Intermediate (WTI) dropped $1.12, or 1.1 percent, to $103.03 a barrel.
Market sentiment was shaped largely by shifting political signals from Washington. Trump told lawmakers that the war could end “very quickly”, but also indicated that further US military action against Iran had not been ruled out. He added that an earlier strike had been delayed despite being close to approval, while also claiming Tehran was seeking a deal.
Analysts said the mixed messaging was driving volatility in oil markets. Emril Jamil, senior oil research analyst at LSEG, said prices had softened on expectations of a possible agreement, but warned that any downside could be limited. “Even if a deal is reached, supply is unlikely to return to pre-war levels immediately,” he noted.
Fujitomi Securities analyst Toshitaka Tazawa said traders were struggling to assess whether Washington and Tehran could reach common ground, especially as US policy signals continue to shift. He added that oil prices were likely to remain supported due to the risk of renewed conflict and lingering supply disruptions.
Despite recent talks, concerns over global supply routes remain in focus. Some tankers have resumed movement through the Strait of Hormuz, although traffic is still far below normal levels of about 130 ships per day before the conflict. On Wednesday, two supertankers exited the strait, while another vessel left after being stuck in the Gulf for more than two months carrying around 6 million barrels of crude.
At the same time, major financial institutions remain cautious. Citi has projected Brent could climb to $120 per barrel in the near term, warning that markets may be underestimating the risk of prolonged disruption.
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