WTI pauses after the previous day’s steep decline as traders weigh conflicting signals surrounding a possible US-Iran peace agreement. Trump pointed to progress in negotiations with Iran, though he also warned that military action remains possible if talks fail. Meanwhile, declining US crude inventories driven by solid demand continue to lend support to oil prices.
West Texas Intermediate (WTI), the US crude oil benchmark, stabilized after plunging nearly 5% in the previous session as traders assessed conflicting signals surrounding a possible US-Iran peace agreement. The commodity hovered near $98.30 on Thursday, little changed on the day, with markets closely monitoring developments in the Middle East.
US President Donald Trump said the US was in the “final stages” of negotiations with Iran, raising hopes for easing tensions. US Vice President JD Vance also expressed optimism, noting that Iran appeared willing to reach an agreement. The comments initially pressured crude prices lower overnight, though losses were capped after Trump warned that further military action remained possible if talks collapsed.
Iran responded by condemning Trump’s warning and cautioned that any renewed US or Israeli strikes could significantly intensify the conflict. Investors also remain doubtful that a peace deal can be achieved soon due to deep disagreements over Tehran’s nuclear program and ongoing tensions surrounding the Strait of Hormuz. Iran has reportedly introduced a new “Persian Gulf Strait Authority” aimed at overseeing traffic through the vital shipping route.
These geopolitical concerns continue to support oil prices and help prevent a deeper sell-off. Additional support came from the latest Energy Information Administration data, which showed declines in US crude and gasoline inventories last week amid resilient demand. As a result, traders may wait for stronger follow-through selling before concluding that crude prices have formed a near-term top.
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