The U.S. sanctions on Iran triggered oil price declines during Friday’s market session because the country chose diplomatic solutions over military actions in the Israel-Iran conflict.
The price of Brent crude decreased by 2.9% to reach $76.58 per barrel while U.S. West Texas Intermediate for July delivery dropped to $74.93. The August contract price showed a slight decrease to $73.45.
The price decrease occurred after President Donald Trump postponed his decision about U.S. military action while the Treasury Department imposed sanctions on more than twenty entities and individuals including Hong Kong-based companies.
The analysts believe this move indicates that the United States is working toward negotiations instead of preparing for immediate conflict. According to John Kilduff who serves as a partner at Again Capital the U.S. government appears to want to solve this issue through diplomatic means rather than military action.
The price of oil decreased during the day yet the market shows a positive trend for the current week. The market experienced significant price fluctuations during the previous week because of news reports about Middle Eastern tensions and potential supply disruptions.
The market waits for Trump’s final decision because traders need to understand how long the current oil price stability will persist.
