The suspension of negotiations between the United States and Iran, combined with the continued closure of the Strait of Hormuz, caused a dramatic spike in crude oil prices and a sharp decline in gold rates yesterday and today, Tuesday.
Brent crude for June delivery rose 2.8% in the previous day’s trading to its highest level since April 7. However, the climb of “black gold” did not stop there; in today’s sessions, oil rose by an additional $2.32, or 2.1%, reaching $110.90 per barrel. This marks the seventh consecutive day of gains for the benchmark.
Similarly, U.S. West Texas Intermediate (WTI) for June delivery increased by $1.80, or 1.9%, to reach $99.14 per barrel, following a 2.1% rise in the previous session.
According to published reports, a U.S. official stated that Donald Trump is dissatisfied with Iran’s latest proposal to end the two-month-old conflict. Consequently, hopes for a resolution to the conflict, which has disrupted energy supplies and exacerbated inflation, have faded.
Following the news of the halted talks, Goldman Sachs released a new analysis citing an unprecedented decline in Middle Eastern oil production due to the war and disruptions in the Strait of Hormuz. The bank subsequently raised its oil price forecasts for the fourth quarter of 2026.
The bank now predicts the following prices for the fourth quarter of this year:
Brent Crude: $90 per barrel, up from the previous forecast of $80.WTI Crude: $83 per barrel, up from the previous forecast of $75.Goldman Sachs analysts attributed this shift to an “unprecedented supply shock.” They estimate that the war and the disruption of the Strait of Hormuz have led to a reduction of 14.5 million barrels per day in crude oil production from the Persian Gulf region.
This record-breaking decline caused global oil inventories to drop at a record pace of 11 to 12 million barrels per day during the month of April.
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