Breaking News! Oil Prices Plunge 16%, Dropping Below US$100 Level

Jakarta, CNBC Indonesia — Global oil prices reversed direction and fell sharply during trading on Wednesday afternoon (1/4/2026). According to Refinitiv data at 14:20 WIB, Brent was recorded at US$99.35 per barrel, down from the previous position of US$118.35 per barrel. On a daily basis, the Brent decline reached around 16%. Meanwhile, West Texas Intermediate (WTI) fell more moderately to US$97.44 per barrel from US$101.38, or weakening by about 3.9%. This weakening occurred after prices had strengthened at the start of trading, then reversed downwards as market participants began to secure profits. A Reuters report mentioned that the main sentiment came from the dynamics of the Middle East conflict, particularly regarding the potential end of the war between the United States and Iran in the near future. US President Donald Trump stated that military operations could be completed in two to three weeks. This statement triggered speculation that the geopolitical risk premium, which previously drove oil prices, is starting to diminish, thus encouraging selling action. Nevertheless, uncertainty has not fully dissipated. Global energy distribution routes, particularly the Strait of Hormuz—through which about 20% of world oil trade passes—still face disruptions. Even if the conflict eases, the recovery of logistics flows is deemed not to happen quickly. Market analysts also highlighted that damage to energy infrastructure as well as shipping and tanker insurance costs could remain high for some time. This means pressure on the supply side still looms over the market. On the other hand, a Reuters survey showed that OPEC oil production fell in March due to export cuts triggered by the closure of distribution routes. Meanwhile, in the United States, oil production had sharply declined in January due to extreme winter storms. Price movements over the past week illustrate high volatility. Brent had touched US$118 on 31 March before finally dropping below US$100 today. This fluctuation reflects the tug-of-war between expectations of the conflict easing and the remaining supply disruption risks.