Brent falls below $90 as Trump holds off new strikes on Iran
Brent crude fell below $90 a barrel on Tuesday for the first time since August 31, after US President Donald Trump said he would hold off from new military strikes on Iran, easing fears of a sustained disruption to Middle East supply.
Brent futures were down $2.39, or 2.58%, at $90.18 a barrel by 0930 GMT, after settling 5.85% lower in the previous session. US West Texas Intermediate fell $2.11, or 2.43%, to $84.74.
Trump said on Monday he planned to hold off from new strikes after appeals from countries in the region, including Qatar's prime minister. "The market continues to prioritise President Trump's more conciliatory tone toward Iran since the midterms," said Tim Waterer, chief market analyst at KCM Trade. "While attacks on shipping around the Strait of Hormuz are still occurring, they have not escalated in a way that has forced a fresh risk premium into the market."
Supply is also weighing on prices. JPMorgan said in a report last week that the global surplus is estimated at around 1.4 million barrels per day in October, as high prices curb demand. OPEC output rose in October, led by gains in Saudi Arabia, Kuwait and Iraq, despite continued constraints on exports.
Brent has retreated about 23% from the six-month high of $118 it touched on October 30, though concerns remain over potential shipping disruption. Separately, Russian and Ukrainian officials planned to meet on Tuesday for US-brokered talks, their first since February, after Trump suggested last week that a broad peace deal was possible.
