Oil prices on Thursday plummeted after President Donald Trump hinted at a potential nuclear deal with Iran, sparking hopes of increased oil supply.
The U.S. president stated that a deal was “getting close,” which could avert a military strike on Iran’s nuclear sites.
“We’re not going to be making any nuclear dust in Iran. “I think we’re getting close to maybe doing a deal without having to do this, ” Trump said.
This development led to a significant decline in crude oil prices, with both main contracts sinking over three per cent.
The commodity had already been falling due to signs that Iran could agree to certain demands.
According to Ali Shamkhani, an adviser to Supreme Leader Ayatollah Ali Khamenei, Iran could accept far-reaching curbs on its atomic program in exchange for sanctions relief.
Shamkhani mentioned that Iran could agree to never develop nuclear weapons, give up stockpiles of highly enriched uranium, allow inspectors to nuclear sites.
In response to a question about signing an agreement with Washington, Shamkhani said “yes” if sanctions were lifted “immediately”.
Meanwhile, equity markets were uncertain as investors awaited fresh developments in trade talks.
The recent China-US detente has lost momentum, and markets are searching for new catalysts to drive a rally.
Despite Beijing suspending some non-tariff countermeasures on US entities, enthusiasm remains limited ¹ ².
Analysts caution that the real impact of the U.S. trade policies won’t be seen until May’s figures were released.
Charu Chanana, chief investment strategist at Saxo, noted that “the trade truce may hold for now, but the tariffs announced many still around 30 per cent are not disappearing”.
These tariffs could reshape supply chains, corporate margins and inflation, potentially leading to weaker economic data in the third quarter.
AFP
