Market sentiment was dominated by a flurry of conflicting news reports, leading to extreme volatility in oil prices. The market witnessed a day of significant price swings as various reports emerged and were subsequently denied, creating confusion among investors. Crude oil prices experienced an intraday range of up to 6%, ultimately closing with a long-shadowed candlestick and a slight decline.
On Thursday afternoon, initial reports suggested that Iran's Supreme Leader demanded that enriched uranium must remain within the country. This news triggered a sharp rally, pushing prices up by 5% from the day's lows. However, these reports were later denied in the evening. In the early hours, Iranian media, citing Saudi Arabia's Al Arabiya television, reported that an agreement between the US and Iran had been reached, causing prices to plummet and breach the day's low. Subsequently, Saudi officials refuted this as false information. This sequence of events resulted in exceptionally chaotic market movements, making it difficult for investors to discern a clear short-term direction for oil prices.
A senior Iranian source, cited by Reuters, indicated that while a deal has not yet been finalized between the US and Iran, the gap between the two sides has narrowed. The issues of Iran's uranium enrichment and its control over the Strait of Hormuz remain key sticking points. A Pakistani senator, in a media interview, stated that negotiations involving Iran, Pakistan, and the US are ongoing, with Pakistan making every effort to bring all parties back to the negotiating table to reduce differences, reach an agreement, and end the conflict. He expressed optimism, noting that the US-Iran talks are moving in the right direction and have made progress.
Fatih Birol, Executive Director of the International Energy Agency (IEA), stated that the oil reserves released in response to the Iran conflict accounted for only about 20% of the stockpile. The IEA stands ready if member countries wish to inject more reserves into the market. In March, under IEA coordination, members including the US, Germany, and Japan committed to a record release of 400 million barrels from their emergency reserves. Approximately 80% of the stockpile remains available. Birol noted, "How much is released, and whether it is released, will depend on how the market evolves and whether member governments decide to do so." An IEA report earlier this month pointed out that global observable oil inventories were declining at a rate of about 4 million barrels per day during March and April. The impact on global oil exports is intensifying as the Middle East conflict has effectively kept the Strait of Hormuz under sustained closure. While the IEA-coordinated reserve releases have helped curb the rise in crude futures prices, oil remains above $100 per barrel.
Reaching an agreement requires both the US and Iran to continue making significant concessions. Based on their previous negotiation demands, the prospects remain highly uncertain. The Iranian Foreign Ministry stated that the current focus of negotiations is on ending the conflict on all fronts. On the 21st, US Secretary of State Rubio said that some progress has been made in the talks with Iran, but he could not guarantee an agreement would be reached. He added that if a "good deal" cannot be achieved, "everyone knows" what other options the US has. Today's 6% intraday swing in oil prices serves as a prelude to the potential outcome of these US-Iran negotiations. Regardless of whether a deal is ultimately reached, it is expected to deliver a significant shock to oil prices. The result may be revealed around the weekend. Until the outcome is clear, investors are advised to consider options strategies, participate cautiously, and strengthen risk control.
Daily Market Data 1. WTI crude oil futures fell by $1.91, or 1.94%, settling at $96.35 per barrel. Brent crude oil futures fell by $2.44, or 2.32%, settling at $102.58 per barrel. INE crude oil futures fell by 3.41%, settling at 633.6 yuan. 2. The US Dollar Index rose by 0.08% to 99.2. The USD/CNH exchange rate fell by 0.09% to 6.7884. The US 10-year Treasury yield rose by 0.06% to 109.31. The Dow Jones Industrial Average rose by 0.55% to 50,285.66.
Recent Key Developments 1. A senior Iranian official, as reported by Al Jazeera, denied reports that Supreme Leader Mojtaba Khamenei had issued a new order requiring enriched uranium to remain in Iran, calling it "propaganda by the enemies of the agreement." The official added, "No new order has been issued. Tehran's position has always been consistent—Iran will dilute these materials itself, which will also be the subject of the next phase of negotiations."
False Report 1: Earlier reports claimed Iran's Supreme Leader demanded enriched uranium must remain in the country, creating a major point of contention with the US position, which hopes to ship the near-weapons-grade material abroad. This was cited as a key sticking point in the negotiations. Following this report, crude oil prices surged, and US Treasury yields rose sharply.
False Report 2: Iran's Labour News Agency (ILNA), citing Al Arabiya, reported that a final draft of a US-Iran agreement had been reached with Pakistan's mediation and was expected to be announced within hours. The draft reportedly included an immediate comprehensive ceasefire on all fronts; mutual commitments not to target infrastructure; guaranteed freedom of navigation in the Persian Gulf and Strait of Hormuz under a joint monitoring mechanism; a gradual lifting of sanctions on Iran in exchange for its compliance with the agreement's terms; and negotiations on unresolved issues to begin within a maximum of seven days.
Hours later, Al Arabiya stated that Iranian media reports claiming a US-Iran agreement had been reached and attributing the news to their channel were fabricated. It characterized the Iranian media's actions as journalistic misconduct for publishing the report without verification.
2. Middle East crude benchmarks edged higher as spot supply remained tight, with the market watching for progress in US-Iran peace talks. a) On Thursday, the premiums for Middle East benchmarks Oman, Murban, and Dubai crude rose slightly due to persistently tight spot supply, while traders also monitored developments in US-Iran talks. Pakistan intensified diplomatic efforts on Thursday to facilitate the talks. Iran stated it is reviewing Washington's latest response. b) The cash Dubai premium over swaps rose by 14 cents to $9.50 per barrel. BP sold a cargo of July-loading Omani crude to Vitol at a price between $103.50 and $103.80 per barrel. GME Oman was quoted at $102.95 per barrel, while cash Dubai was at $103.70 per barrel. c) Analysts noted that the Iran conflict has restricted Saudi crude exports, and reduced gas supply following the shutdown of some fields is expected to lead Saudi Arabia to burn more imported fuel oil for power generation this summer. Official data and sources indicate that nearly all major refineries in central Russia have been forced to shut down or reduce operations due to recent drone attacks.
3. With a key energy artery constrained, the UAE accelerates a bypass project, with a new pipeline slated for 2027. a) The CEO of Abu Dhabi National Oil Company stated on Wednesday that the UAE's second pipeline bypassing the Strait of Hormuz is nearly 50% complete. The project has been accelerated due to the Iran conflict and is expected to be operational by 2027. b) The new pipeline will double the UAE's export capacity via the Fujairah port, located in the Gulf of Oman outside the Strait of Hormuz. The UAE already diverts up to 1.8 million barrels per day of crude exports through an existing pipeline. c) The CEO pointed out that the blockade on the Strait of Hormuz imposed in early March has caused the most severe energy supply disruption in history. The closure has resulted in a loss of over 1 billion barrels of oil, with nearly 100 million additional barrels lost for each week of closure. d) Even if the conflict ended immediately, it would take at least four months to restore oil flows to 80% of normal levels. Full normalization is not expected until the first or second quarter of 2027. e) The US Energy Secretary stated last week that with Gulf countries building more bypass infrastructure post-conflict, the importance of the Strait of Hormuz to global energy markets may decline, as alternative energy export routes from the Persian Gulf become available.
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