Oil prices ended nearly flat after intraday volatility as traders assessed reports of a preliminary agreement between the United States and Iran. The deal aims to extend a ceasefire and advance efforts toward a war-ending accord. This development propelled London copper futures to a two-week peak, while spot gold prices rose amid reduced bets on higher interest rates.
Crude Oil: Prices Steady as Traders Weigh US-Iran Ceasefire Reports Oil prices closed largely unchanged following a choppy session, with market participants digesting news of a preliminary US-Iran agreement. The accord seeks to prolong the ceasefire and facilitate negotiations to end the conflict.
WTI crude edged up 0.3%, settling just below $89 per barrel. The global benchmark Brent crude dipped slightly to under $94, after fluctuating between gains and losses during the day.
According to an Axios report, the memorandum of understanding would extend the ceasefire by 60 days and ensure "unrestricted" shipping through the Strait of Hormuz without any toll payments to Tehran. The report noted that former President Donald Trump still needs to approve the terms, having requested "a few days" to decide.
A ceasefire extension would mark a diplomatic breakthrough, potentially moving the US and Iran closer to restoring normal maritime traffic through the Strait of Hormuz—a chokepoint for roughly one-fifth of global oil and liquefied natural gas supplies.
Reopening this critical passage could help alleviate the months-long energy crisis that has driven worldwide fuel costs sharply higher. However, even with a preliminary deal, intensive further negotiations over Tehran's nuclear program would be required to reach a final peace agreement.
"I remain very cautious about the potential agreement, but we'll see if there's any confirmation and if traffic through the strait actually picks up," said Ryan McKay, senior commodity strategist at TD Securities. "Regardless of the deal, inventory draws are likely to persist for months."
Meanwhile, US Treasury Secretary Scott Bessent emphasized on Thursday that Trump's three "red lines"—reopening the Strait of Hormuz, Iran surrendering its highly enriched uranium, and terminating its nuclear program—remain essential for any agreement.
News of the potential accord overshadowed a US Energy Department report showing a 3.3-million-barrel draw in domestic crude inventories last week.
WTI July futures rose 0.3% to settle at $88.90 per barrel. Brent July futures fell 0.6% to settle at $93.71 per barrel.
Copper Jumps to Two-Week High on US-Iran Ceasefire Reports Copper prices surged to a two-week high as speculation grew that the US and Iran are nearing a diplomatic resolution to the Middle East conflict.
LME copper settled 1.3% higher on Thursday, marking its strongest level since May 14. New York copper futures also climbed to a two-week peak. A US official familiar with the matter indicated that Iran and the US have reached a preliminary agreement to extend the ceasefire and work toward a final deal to end the war.
Base metals have traded in a narrow range in recent weeks, with investors monitoring talks to resolve the conflict that has fueled inflation and pressured global growth prospects. A potential end to the hostilities would ease concerns about a prolonged drag on worldwide growth, which could dampen manufacturer demand for metals.
Optimism over the ceasefire talks spread to other areas of the copper market, with exchange-traded fund investors betting that miners will benefit from rising metal prices.
Other LME metals also advanced across the board. LME copper rose 1.3% to $13,701.5 per metric ton. LME aluminum gained 0.7% to $3,659.5 per metric ton. LME nickel increased 0.8% to $19,101 per metric ton. LME zinc climbed 1.1% to $3,551 per metric ton. LME tin advanced 1.3% to $55,079 per metric ton. LME lead edged up 0.6% to $2,018 per metric ton.
Gold Rises as US-Iran Deal Reports Temper Rate Hike Bets Spot gold prices advanced following reports that Iran and the US have agreed on a preliminary deal to extend the ceasefire and push for an end to the Middle East war, pending final approval from former President Donald Trump.
Gold jumped as much as 1.4%, while the US dollar and Treasury yields declined. A source familiar with the matter stated that the US and Iran have reached an initial agreement to extend the ceasefire by 60 days and launch further talks on Tehran's nuclear program, fueling hopes that the three-month-old conflict may be nearing a resolution.
After declining early in the war, gold has traded within a tight range as traders weigh conflicting signals regarding ceasefire progress between the two nations.
Nicky Shiels, head of metals strategy at MKS Pamp SA, noted that with these reports circulating, improved risk appetite among investors could lift the market. She added that this might also help support gold prices and prevent a break below a key technical level.
However, Shiels remarked that precious metals will likely remain "at the mercy of headlines on the deal's success or failure," adding that with weak physical demand as summer approaches and institutional players staying on the sidelines, it's "hard to be truly bullish" on gold. She expects prices to consolidate around $4,500 per ounce in the near term.
As of 3:57 p.m. New York time, spot gold was up 1% at $4,498.64 per ounce. Silver rose modestly by 1% to $75.61 per ounce.
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