HOUSTON: Oil prices fell sharply on Monday, with Brent crude dropping $2.02 (2.69%) to $73.15 per barrel and US West Texas Intermediate (WTI) declining $2.08 (2.92%) to $69.16, following reports of a potential ceasefire deal between Israel and Lebanon.
Unnamed US officials indicated progress in ending the Israel-Hezbollah conflict, though Israeli and Lebanese leaders expressed cautious optimism, citing unresolved issues and mutual distrust.
Market analysts attributed the price decline to reduced geopolitical risk. UBS’s Giovanni Staunovo noted that no oil supply disruptions had occurred, and the conflict carried minimal risk premium prior to the latest developments.
Phil Flynn of Price Futures Group emphasized the market’s sensitivity to geopolitical shifts. “News of a ceasefire could be a bearish catalyst, but more details are needed,” he said, noting that oil markets remain volatile amid broader global tensions, including Russia’s missile strikes on Ukraine last week.
The situation underscores the fragility of oil prices, as traders balance fears of supply disruptions with hopes for regional stability.
