WTI crude oil price drops to $66 after Israel-Iran ceasefire eases supply fears
WTI crude oil drops to $66 as geopolitical tensions ease with Israel-Iran ceasefire agreement
Oil prices tumbled sharply on June 24, with WTI crude futures sinking to $66 per barrel, down nearly 3% on the day after falling as much as 6% earlier. The steep intraday decline came in response to President Donald Trump's announcement of a ceasefire agreement between Israel and Iran, easing investor fears over a potential regional escalation and disruption in oil flows through the Strait of Hormuz.
Highlights
- WTI crude futures plunge nearly 6% intraday before trimming losses to settle around $66
- Israel and Iran agree to ceasefire, easing fears over Strait of Hormuz disruption
- IEA stockpiles and OPEC+ spare capacity offer supply assurance amid fragile truce
The truce appeared to be accepted by both Israel and Iran, temporarily reducing the risk premium in global oil markets.
Market reaction to geopolitical shift
The Strait of Hormuz, through which over 20% of the world’s oil passes daily, had become a flashpoint after recent military actions raised the specter of a blockade. WTI’s initial plunge mirrored the scale of perceived relief, wiping out gains accumulated during the past two weeks of rising geopolitical tension.
Despite the apparent de-escalation, concerns linger. Israel has already accused Iran of violating the ceasefire agreement and warned of retaliatory missile strikes, raising the possibility that the situation could flare up again.
Supply reassurance and technical outlook
Adding to downward pressure, the International Energy Agency reaffirmed its readiness to deploy 1.2 billion barrels of emergency oil reserves if required. Furthermore, some OPEC+ members are reportedly increasing output, with spare capacity available to offset any supply shortages if the conflict reignites.
USOIL price forecast (Source: TradingView)
WTI’s technical structure also shifted markedly over the past two sessions. After failing to hold the $71 support, the benchmark slid into a broader correction, testing the $64.60–$65.20 support range. While prices attempted to stabilize around $66.25, technical analysts note that a close below $64 would expose $60 as the next potential target. Reclaiming the $70 mark remains key for bulls hoping to reassert control.
Previously, we highlighted that WTI crude oil price was trending higher within a rising wedge pattern. The breakdown from that structure, combined with easing geopolitical fears, has reversed that bias, suggesting the need for caution unless $70 is regained with volume and structure support.
