Oil prices moved higher on Wednesday as investors responded to the Iran-Israel ceasefire. Brent crude rose 85 cents to reach $67.99 per barrel. U.S. West Texas Intermediate (WTI) crude gained 87 cents, reaching $65.24 per barrel.
These gains followed steep drops earlier this week. Both Brent and WTI had touched multi-week lows. Traders reacted cautiously to signs that crude supply flows would remain stable.
Earlier, markets spiked after U.S. airstrikes hit Iranian nuclear facilities. However, the Iran-Israel ceasefire eased concerns about immediate supply disruptions. Energy prices had surged to five-month highs after the strikes but pulled back once tensions cooled.
JP Morgan analysts said global energy prices were adjusting. They noted that fundamentals point to enough global oil supply. Their base case expects stability, assuming no major export disruptions from the region.
The Iran-Israel ceasefire came after twelve days of intense conflict. U.S. President Donald Trump brokered the agreement after criticizing both nations for escalating the conflict. Each country claimed success after lifting civilian restrictions.
Still, uncertainty surrounds the situation. Experts describe the ceasefire as fragile. Capital Economics warned that oil prices may remain under pressure unless energy infrastructure gets targeted. They emphasized that oil flows through the Strait of Hormuz remain the key factor.
Between 18 and 19 million barrels of crude pass through the Strait daily. This represents nearly 20% of the world’s oil consumption. Any threat to this waterway could cause massive market disruptions.
For now, both Iran and Israel avoid targeting export infrastructure. This restraint gives markets some breathing room. As long as the Iran-Israel ceasefire holds, prices may remain stable or drop further.
Investors also watched U.S. domestic data for further clues. Industry sources reported a draw of 4.23 million barrels in U.S. crude inventories last week. Official government figures were expected later on Wednesday.
These numbers support the idea of steady demand. Fewer crude stockpiles could indicate healthy fuel consumption. If true, this trend may limit price drops in the coming days.
Despite recent volatility, energy traders remain cautious. The Iran-Israel ceasefire brings hope, but tension still lingers. Many worry that one misstep could reignite conflict and hit supply chains hard.
Until long-term calm returns, markets will continue reacting to headlines. For now, oil prices balance between geopolitical risk and steady supply.