Global oil prices slump this week amid US-Iran tensions

Global oil prices fell again in recent trading as markets responded to optimism over a potential ceasefire extension between the United States (US) and Iran. Although the daily drop was modest, crude oil recorded a sharp weekly correction due to reduced concerns about global supply disruptions.

Market participants continue to monitor negotiations between Washington and Tehran. Hopes for a new agreement have intensified downward pressure on oil prices, though geopolitical uncertainty keeps energy market volatility high.

The July Brent crude oil contract, expiring on Friday, 29 May 2026, fell 35 cents, or 0.37%, to US$93.36 per barrel, equivalent to approximately Rp1.66 million per barrel. US West Texas Intermediate (WTI) crude dropped 63 cents, or 0.71%, to US$88.27 per barrel, or around Rp1.57 million.

The more actively traded August Brent contract also declined 46 cents, or 0.50%, to US$92.24 per barrel, or roughly Rp1.64 million.

Despite limited daily losses, oil prices recorded a weekly decline of over 8%. Last week, Brent surged to US$109.47 per barrel before falling to a weekly low of US$87.11.

These extreme fluctuations highlight the global energy market’s sensitivity to Middle Eastern geopolitical developments. In recent trading sessions, Brent and WTI prices swung wildly by up to US$6 due to conflicting reports on the potential resolution of a three-month conflict involving Iran.

Markets are now focused on the Strait of Hormuz, a strategic shipping route that accounts for nearly one-fifth of global oil and liquefied natural gas supplies. Shipping activity through the area remains well below pre-conflict normal levels.

However, reports of potential easing of shipping restrictions have provided some relief to global energy markets. According to multiple reports, the US and Iran reached an initial agreement on Thursday to extend the ceasefire and reopen shipping access in the Strait of Hormuz.