Crude futures fall after Iran announces a mediated draft agreement with the US, easing geopolitical tensions in the Middle East.
Crude oil futures settled 1.94% lower at $96.35 after Iran’s President confirmed a draft agreement with the US, mediated by Pakistan. The deal eased concerns over supply disruptions in the Strait of Hormuz, a critical oil transit route.
Prior to the announcement, oil prices had been supported by OPEC+ plans to increase output quotas by 188,000 barrels per day at its June 7 meeting. Market sentiment was also influenced by mixed US economic data, including a weaker-than-expected Philly Fed index and near-consensus jobless claims.
US stock indices opened lower, while the USD gained ground, with USDCAD reversing to the upside as investors weighed the geopolitical developments against domestic economic signals.