Oil Retreats on Signs of De-Escalation

Crude oil prices declined sharply on Thursday as investors reacted to reports suggesting the White House remains focused on preserving the fragile ceasefire with Iran rather than escalating military operations.

West Texas Intermediate (WTI) crude futures fell 3.1% to settle at $93.04 per barrel, while Brent crude, the global benchmark, dropped 2.8% to close at $95.03 per barrel.

The decline followed reports that President Donald Trump told advisers he believes the weekslong ceasefire with Iran is largely holding despite occasional clashes and ongoing regional tensions.

Trump Prioritizes Diplomacy

According to reports, Trump has indicated that while the United States remains prepared to respond if American forces are targeted, he currently prefers maintaining diplomatic channels rather than restarting a broader conflict.

A White House official emphasized that the administration continues to favor a negotiated resolution but remains prepared to act if Iran refuses to engage constructively or threatens U.S. interests.

The market interpreted the comments as a sign that the likelihood of a major escalation may be lower than previously feared.

Lebanon Ceasefire Offers Hope for Broader Progress

Investor sentiment also improved after Israel and Lebanon agreed to implement a ceasefire on Wednesday.

The development could help remove one of the major obstacles complicating negotiations between Washington and Tehran. Earlier this week, Iranian media reported that talks with the United States had stalled due to Israel’s military operations against Hezbollah in Lebanon.

While uncertainty remains regarding the durability of the ceasefire, the agreement is viewed as a potentially positive step toward broader regional stabilization.

Political Pressure Mounts in Washington

The administration is also facing increasing scrutiny from lawmakers regarding U.S. military involvement in the conflict.

On Wednesday, the House of Representatives approved a resolution calling on the president to either withdraw U.S. forces from the conflict or seek congressional authorization for continued military operations.

Although the measure still faces Senate consideration and would likely encounter a presidential veto, it highlights growing political debate over the scope and duration of U.S. engagement in the region.

Markets Remain Focused on Hormuz and Supply Risks

Despite Thursday’s decline, oil prices remain elevated compared with levels seen before the conflict began.

Investors continue to closely monitor developments surrounding the Strait of Hormuz, a critical global energy shipping route, along with negotiations involving Iran, Israel, Lebanon, and the United States.

Any indication of renewed military escalation or disruption to energy exports could quickly reverse recent declines and reintroduce significant volatility into global energy markets.