Crude prices initially rose on US strikes on Iran, but fell due to limited retaliation.

From Yahoo Finance: 2025-06-23 11:43:00

Crude oil and gasoline prices initially soared to a 5-1/4 month high in response to US strikes on Iran’s nuclear facilities but later fell -0.99% and -0.56%, respectively, due to speculation that Iran’s retaliation won’t disrupt Middle East oil supplies significantly.

Iran’s response to US strikes on its nuclear sites has caused concern about potential disruptions to Middle Eastern oil supplies. Iran has not closed the vital Strait of Hormuz, but threats remain, with the possibility of oil prices temporarily hitting $120 to $150 a barrel if the strait is blocked.

OPEC+ agreed to gradually increase crude production by 411,000 bpd for July, with additional increases expected. Saudi Arabia’s strategy of boosting output aims to reduce prices and punish overproducing members. OPEC+ plans to restore 2.2 million bpd of production by September 2026, reversing a 2-year-long production cut.

Gasoline prices are supported by a projected increase in Fourth of July travel by car and stronger demand. President Trump’s tariff concerns continue to impact oil prices, with impending letters to US trading partners setting unilateral tariffs.

A decline in crude oil stored on tankers contributes to bullish oil prices, with a -13% drop in tankers’ stationary storage reported. US crude oil inventories are below seasonal averages, and active oil rigs fell to a 3-3/4 year low of 438 rigs.

Read more: Crude Prices Erase an Early Advance as Iranian Retaliation Appears Limited