HOUSTON: Oil prices fell around 4 percent and were poised to end a five-day streak of gains on Thursday after US President Donald Trump said the crackdown on protesters in Iran was easing, allaying concerns over potential military action against Iran and oil supply disruptions.
Brent futures were down USD2.62 or 3.94 percent, at USD63.90 a barrel by 1:38 p.m. EDT (1838 GMT). US West Texas Intermediate crude fell USD2.67, or 4.3 percent, to USD59.35.
Both contracts had risen to multi-month highs over the last few sessions.
Trump said he had been told that killings during Iran’s crackdown on protests were easing and he believed there was no current plan for large-scale executions, adopting a wait-and-see posture after earlier threatening intervention.
The comments reduced the risk premium that had built up in recent days, analysts said. On Wednesday, Brent reached a high of USD66.82, its highest since September.
“We went from a high likelihood that Trump was going to hit Iran to a low likelihood, and that is the bulk of the downward pressure today on prices,” said Phil Flynn, senior analyst with Price Futures Group.
The United States is withdrawing some personnel from military bases in the Middle East, a US official said on Wednesday, after a senior Iranian official said Tehran had told neighbours it would hit American bases if Washington strikes.
Further weighing on prices, US crude and gasoline inventories rose last week by more than analysts had estimated, the Energy Information Administration said on Wednesday.
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