Oil Falls After Peace Agreement
Oil prices fall and global stock markets rise on Monday after the news that the US and Iran have agreed on a peace agreement.
At 1:15 p.m., fuel oil is down just over 4 percent to just under $83 per barrel, while WTI oil is down nearly 5 percent to around $80. In Asia, stock markets rose broadly and both Tokyo and Seoul closed around 5 percent higher. Stock markets in Europe, including Stockholm, are also up.
On Sunday evening, the US and Iran announced that the countries have agreed on a peace agreement. According to US President Donald Trump, the agreement will be signed on Friday and the Strait of Hormuz will then be opened.
Analyst: It will take months for the market to return to normal
Despite the agreement between the US and Iran, it will take several months before deliveries of gas and oil return to normal, experts say, according to Bloomberg. While an agreement reduces supply risks and rising prices, it will take time for companies to reorganize operations and regain confidence.
“The market tends to see the reopening as an on-off switch, but in reality it is more of a process,” said Haris Khurshid, chief investment officer at Karobaar Capital, according to the news agency.
Priyanka Sachdeva, an analyst at brokerage Phillip Nova, predicts that energy costs will be elevated for several months to come.
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