WTI edges lower to near $89.50 as Iran, Israel agree to halt attacks

West Texas Intermediate (WTI) oil price edges lower after registering over 1% losses in the previous day, trading around $89.40 per barrel during the Asian hours on Tuesday. Crude oil prices have declined as supply concerns eased following an agreement between Iran and Israel to halt mutual attacks. The de-escalation came after an appeal from US President Donald Trump, boosting hopes that peace negotiations could move forward.

However, complete stability remains elusive. CNBC reported on Monday that Israeli Prime Minister Benjamin Netanyahu stated the war against Iran and its Lebanon-based proxy, Hezbollah, "has not yet ended," though he insisted both entities are weaker than ever. His remarks followed a statement from Iran’s military confirming it had ceased strikes against Israel. Nevertheless, Iran’s central military command issued a stern warning, declaring that if Israel continues its attacks, including those in southern Lebanon, "much harsher and more crushing actions than before will be on the way."

The recent pause follows a series of direct military exchanges. Israel previously hit a petrochemical plant in southwestern Iran that it claimed was used to produce ballistic missiles. In response, Iran's Islamic Revolutionary Guard Corps retaliated with a strike targeting a similar Israeli facility in the city of Haifa. This exchange followed intense over-the-weekend Israeli strikes on Hezbollah strongholds in Beirut. Tehran has repeatedly maintained that any deal with Washington to end the conflict is contingent upon Israel halting its military campaign in Lebanon.

While President Trump has urged both sides to de-escalate and noted that ongoing talks with Tehran should eventually ease oil prices, significant energy supply challenges persist. Although the ceasefire currently remains intact, the Strait of Hormuz is still effectively closed under a dual blockade by the US and Iran. This blockade continues to severely disrupt the shipment of crude oil, refined fuels, and natural gas to global markets.