Oil prices fell on Friday night as traders sold off earlier gains after reports emerged that Iran had sent a new negotiation proposal to the United States, easing immediate fears of a deeper supply shock from the Middle East.
As at the close of trading crude prices were lower as the market reacted to signs of possible diplomatic engagement between Washington and Tehran after days of war-driven volatility.
As at the time of writing 09:00 AM (WAT), Brent crude traded at $107.36 per barrel, down 2.6 per cent, while West Texas Intermediate fell to $99.90 per barrel, losing 4.7 per cent after briefly climbing above the $100 mark earlier in the session.
The pullback came after a week of sharp swings that pushed oil to some of its highest levels in years. Brent had surged to $126 per barrel on Thursday as traders priced in the risk of prolonged disruption to global crude flows through the Strait of Hormuz, one of the world’s most important oil transit routes.
That rally slowed on Friday after reports said Tehran had sent a fresh negotiation proposal to the Trump administration through Pakistani mediators, prompting traders to cut positions and lock in profits.
The decline was not driven by improved supply conditions. It was driven by the market’s response to a possible pause in escalation.
Checks by Petroleumprice.ng show that traders remain cautious because the core issue has not changed. The risk to crude supply through the Strait of Hormuz remains active, and the market is still reacting to every signal coming out of Washington and Tehran.
Analysis by Petroleumprice.ng shows that Friday’s decline does not signal that the oil rally is over. It shows that traders are reacting to diplomacy, but the market still carries a heavy geopolitical risk premium.
As long as tensions around Iran and the Strait of Hormuz remain unresolved, oil prices will remain highly unstable, and any fresh military threat or shipping disruption could quickly send crude higher again.