(RTTNews) – Oil prices fell sharply on Thursday, snapping a three-day rally as Israel and Lebanon agreed to implement a ceasefire.
Brent crude futures for August delivery fell 1.5 percent to $96.30 a barrel while WTI crude futures for July delivery were down 1.2 percent at $94.83.
After a fourth round of U.S.-mediated talks, Israel and Lebanon have agreed to renew their fragile ceasefire following days of bombardment and drone strikes.
According to a joint statement, the agreement was “contingent on a complete cessation” of attacks by the Iran-backed armed group Hezbollah, among other conditions.
Recent U.S.-Iran clashes coupled with no meaningful breakthrough in peace talks underscore the ongoing risks facing energy markets and Gulf shipping.
Kuwait said 63 people were injured following strikes that hit the country on Wednesday damaging its international airport.
Iran said communication channels with Washington remain open but there has been “no tangible progress” to end the war.
In contrast, U.S. President Donald Trump said progress in talks with Iran could come within days, with possible movement as early as the weekend.
The U.S. House of Representative passed a resolution that seeks to halt President Donald Trump from taking further military action in Iran. However, analysts say that the resolution is unlikely to come into effect.
Meanwhile, the EIA report showed U.S. commercial crude oil inventories dropped for a sixth consecutive week, increasing concerns about a global oil shortage.
According to the U.S. Energy Information Administration, crude oil inventories in the U.S. fell by 7,974,000 barrels for the week ending May 29. At the Cushing, Oklahoma delivery hub, inventories decreased by 583,000 barrels.
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