Martha Dowding
Research Associate, Flux
Break Drops Lower Amid Peace Deal Speculation
Brent drops below $88 on US-Iran peace hopes, though military tensions keep markets volatile and cautious.
M1 Brent Futures crude futures reached a daily high of $89.96/bbl at 15.02 BST and dropped to $87.29/bbl sat the time of writing at 19:09 BST (time of writing).
This afternoon was dominated by a single theme: US-Iran peace deal speculation, whipsawing crude and gas prices in both directions. Brent shed more than 4% to below $84/bb, an eight-week low, as senior officials from both sides signalled they were edging toward an agreement to reopen the Strait of Hormuz, potentially in time for next week's G7 summit, according to Bloomberg. Iran's Foreign Minister Araghchi added fuel to the rally-in-reverse by saying an MOU had never been closer to being signed. Trump then complicated the picture, telling reporters that the published terms of the draft deal didn't reflect what was actually discussed, prompting a brief and partial bounce. Underlying caution remains justified, US forces were reported to have intercepted Iranian drones near commercial vessels during the session, a reminder that the conflict is not over. Finally, the Aug/Sep’26 and Aug/Feb’27 Brent futures spreads are at $1.17/bbl and $6.48/bbl, respectively.
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