Oil prices little changed as ceasefire holds and US crude stocks fall

Oil extends slide as Trump indicates possible Iran peace deal
By Helen Clark and Jeslyn Lerh

Oil Prices Drop Amid Hopes for Iran Peace Deal
SINGAPORE, May 6 (Reuters) – Oil prices fell for a second day on Wednesday on expectations bottled-up supply from the key Middle East producing region could resume flowing after U.S. President Donald Trump indicated a possible peace deal may be reached to end the war with Iran.

Recent Movements in Oil Prices
Brent crude futures fell $1.89, or 1.7%, to $107.98 a barrel as of 0340 GMT, after dropping 4% in the previous session. U.S. West Texas Intermediate futures eased $1.83, or 1.8%, to $100.44, after settling down 3.9% the day before.

Trump’s Announcement and Market Reaction
On Tuesday, Trump unexpectedly said he would briefly pause an operation to help escort ships through the Strait of Hormuz, citing progress toward a comprehensive agreement with Iran, without giving details on the agreement. There was no immediate reaction from Tehran.

Potential Impact on Oil Supply
“This signals potential de-escalation and raises hopes for the release of stranded vessels inside the Gulf, which could gradually bring supply back to the market,” said Anh Pham, senior research specialist for oil at LSEG.

Pham added that prices remain elevated with both Brent and WTI staying above $100 per barrel as prospects for a peace deal remain uncertain, while it will take time for trade flows to be fully restored even if a deal is reached.