Global crude oil prices retreated following President Donald Trump’s announcement that a ceasefire agreement between Israel and Hezbollah in Lebanon is nearing completion. This diplomatic development calmed commodity markets, reversing a recent rally driven by geopolitical tensions.
Brent crude for August delivery dropped to $93.35 per barrel, while West Texas Intermediate (WTI) crude for July delivery declined to $90.65 per barrel, both marking a decrease of roughly 1.7%. The easing of prices came after Trump shared on social media that the two sides agreed to halt hostilities and that he had a constructive conversation with Israeli Prime Minister Benjamin Netanyahu aimed at de-escalation.
The potential ceasefire involves Israeli strikes ceasing on Beirut’s southern suburbs in exchange for Hezbollah halting attacks against Israel. The Lebanese Embassy in Washington confirmed via social channels that Hezbollah accepted a U.S. proposal for a mutual cessation of attacks, with plans to extend the ceasefire across all Lebanese territory.
Despite these advances, Iranian state media and the Revolutionary Guard reported that Tehran had suspended indirect talks with the U.S. in protest against Israeli operations in Lebanon, injecting uncertainty into the situation. Market participants remained cautious, awaiting further confirmation on whether the ceasefire will hold amid ongoing political statements from Washington and Tehran.
Alongside crude, U.S. Treasury yields also declined as traders adjusted to the reduced risk of escalating conflict. However, investors refrained from significant market positions, awaiting key U.S. labor data due later this week—including April job openings and May nonfarm payrolls—which are expected to influence Federal Reserve policy decisions on interest rates.
Markets forecast a moderation in job growth and a steady unemployment rate, which could signal a cooling labor market and potentially soften the Fed’s stance on rate hikes.