Oil prices turned higher, as the impact of supply disruptions — ranging from production outages in Gulf countries to new attacks on energy infrastructure in the region — outweighed pressure from Iraq resuming exports through the pipeline to Turkey’s Ceyhan port.

With no signs of de-escalation in the conflict with Iran, benchmark Brent crude held above $100 per barrel over the past four sessions.

Brent futures rose by $0.61, or 0.6%, to $104.02 per barrel by 11:55 GMT, after earlier falling to $100.34 during the session.

In contrast, US West Texas Intermediate (WTI) crude fell by $1.28, or 1.3%, to $94.93 per barrel.

Diverging price trends

Ole Hansen, analyst at Saxo Bank, said the divergence in price trends increasingly reflects WTI’s focus on the US market, while Brent more closely tracks global supply disruptions.

Resumption of Iraqi exports

In Iraq, sources at North Oil Company reported that exports via the pipeline have resumed following an agreement between Baghdad and the Kurdistan Regional Government to restart oil flows.

Two oil officials said last week that Iraq aims to pump at least 100,000 barrels per day through the port.

However, analysts at MUFG noted that the easing of supply pressure remains limited, as Iraq’s production is still at about one-third of its pre-crisis levels, while tanker traffic through the Strait of Hormuz remains significantly constrained.

Oil output from Iraq’s main southern fields has fallen by about 70% to 1.3 million barrels per day after the conflict with Iran disrupted the Strait of Hormuz, through which around 20% of global oil flows.

Escalating tensions and attacks

Iran’s Tasnim news agency reported that some oil industry facilities in South Pars and Asaluyeh were targeted by attacks, with the extent of damage still unclear.

The US military also announced strikes on sites along Iran’s coast near the Strait of Hormuz, citing threats from anti-ship missiles to international shipping.

Iran confirmed the killing of National Security Council chief Ali Larijani in an Israeli attack, which, alongside US strikes, has raised some hopes for a quicker end to the conflict.

Additional supply developments

In Libya, the National Oil Corporation announced the gradual rerouting of flows from the Sharara field through alternative pipelines following a fire.

In the United States, data from the American Petroleum Institute showed crude inventories rose by 6.56 million barrels in the week ending March 13, far exceeding expectations of an increase of about 380,000 barrels.

The US dollar fell on Wednesday as oil prices declined, allowing a partial return of risk appetite among investors ahead of a series of central bank meetings.

The US currency weakened against the Japanese yen, which had previously retreated from levels where traders expected intervention by Japanese authorities, ahead of an anticipated meeting in Washington between President Donald Trump and Japanese Prime Minister Sanae Takaichi.

The dollar also reversed course against the euro during the day, as the single European currency continued to rise for the third consecutive session ahead of the start of the European Central Bank’s two-day meeting.

Despite this decline, the dollar still holds overall gains since the start of the US-Israeli attacks on Iran about three weeks ago, as tensions boosted demand for safe-haven assets.

Oil and its impact on markets

Oil prices fell by more than $2 per barrel after an agreement between Iraqi and Kurdish authorities to resume oil exports through Turkey’s Ceyhan port starting Wednesday.

Hirofumi Suzuki, chief FX strategist at Sumitomo Mitsui Banking Corp, said that with the rise in oil prices temporarily pausing, conditions have not improved significantly, but markets have begun to recover somewhat.

He added that movements in the dollar/yen pair indicate a tilt toward yen strength.

Currency moves

The dollar index, which measures its performance against six major currencies, fell 0.04% to 99.51, marking a third consecutive session of decline.

The euro rose 0.04% to $1.1543.

The Japanese yen gained 0.21% to 158.64 against the dollar.

The British pound rose 0.1% to $1.3368.

The dollar had reached a 10-month high at the end of last week as investors turned to safe-haven assets due to escalating conflict in the Middle East and rising oil prices, which held above $100 for Brent crude for four consecutive sessions.

Market expectations and central banks

Analysts at Mizuho Securities indicated that even if the conflict continues without resolution, equities may see a recovery, supporting commodity currencies such as the Australian dollar, as well as currencies of oil-importing countries like the yen and the euro.

The Australian dollar rose 0.21% to $0.7117, while the New Zealand dollar gained 0.19% to $0.5868.

Meanwhile, the US Federal Reserve is expected to announce its monetary policy decision on Wednesday, followed by the European Central Bank, the Bank of England, and the Bank of Japan the next day.

Expectations point to interest rates remaining unchanged, while investors await signals regarding inflation and the economic outlook amid the ongoing war in the Middle East.

Gold prices fell in European trading on Wednesday, resuming losses that were temporarily halted yesterday, trading near their lowest levels in four weeks under pressure from the renewed rise of the US dollar in the foreign exchange market.

The current decline remains limited around the $5,000 per ounce level, as markets await the Federal Reserve’s decisions later today, where interest rates are expected to remain unchanged, alongside further decisive signals on the path of US monetary policy this year.

Price Overview

Gold prices today: gold fell 0.55% to $4,977.73, from the session opening level of $5,006.61, after reaching a high of $5,016.40.

At Tuesday’s settlement, gold prices were little changed after a wave of losses that lasted for four consecutive days, during which the metal recorded a four-week low of $4,967.61 per ounce.

US dollar

The dollar index rose about 0.2% on Wednesday, resuming gains that had paused over the previous two sessions and moving higher toward a ten-month high, reflecting renewed strength in the US currency against a basket of global currencies.

The rise comes as investors continue to buy the dollar as a preferred safe-haven asset amid the escalation of the Iran war, especially following the assassination of Iran’s National Security Council chief Ali Larijani in an Israeli airstrike.

Federal Reserve

The Federal Reserve will conclude later today its second regular meeting in 2026 to discuss the appropriate monetary policy for developments in the world’s largest economy, where US interest rates are expected to remain unchanged at the 3.75% range for the second consecutive meeting.

The interest rate decision and the monetary policy statement and economic projections will be released at 18:00 GMT, with Federal Reserve Chair Jerome Powell scheduled to speak at 18:30 GMT.

The comments and projections are expected to provide further decisive signals about the future path of US interest rates this year, particularly in light of economic developments, especially following the outbreak of the Iran war.

US interest rates

Amid rising oil prices, US President Donald Trump again called on Federal Reserve Chair Jerome Powell to cut interest rates.

According to the CME FedWatch tool from CME Group, markets price a 99% probability that US interest rates will remain unchanged this week, while the probability of a 25-basis-point rate hike stands at 1%.

Markets also price a 99% probability that interest rates will remain unchanged at the April meeting, while the probability of a 25-basis-point rate hike stands at 1%.

Gold outlook

Jim Wyckoff, senior analyst at Kitco Metals, said the gold market reflects a “delicate balance” between safe-haven demand amid rising geopolitical uncertainty and downside pressure from inflation.

Wyckoff added that he believes gold will likely reach new record highs, but not anytime soon, noting that the upward momentum appears to have faded.

Commerzbank said in a note that the Federal Reserve meeting is unlikely to trigger a rally in gold prices, as uncertainty about the duration of the war and disruptions to oil supplies are expected to push the Fed toward a more cautious stance.

SPDR fund

Holdings of the SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, declined on Tuesday by about 1.15 metric tons, marking the fourth consecutive daily decline and bringing the total to 1,069.56 metric tons, the lowest level since January 9.

The euro rose in European trading on Wednesday against a basket of global currencies, continuing to trade in positive territory for the third consecutive day against the US dollar, as it extends its recovery from a seven-month low, supported by buying activity from lower levels ahead of the European Central Bank’s monetary policy meeting.

The US dollar continues to decline ahead of the Federal Reserve’s monetary policy decisions later today, where interest rates are expected to remain unchanged for the second consecutive meeting.

Price Overview

Euro exchange rate today: the euro rose by less than 0.1% against the dollar to $1.1545, from the session opening level of $1.1539, after recording a low of $1.1532.

The euro ended Tuesday’s trading up 0.3% against the dollar, marking its second consecutive daily gain, supported by a recovery from a seven-month low of $1.1411.

European Central Bank

The European Central Bank’s second monetary policy meeting of this year begins later today, with decisions to be announced tomorrow Thursday, where interest rates are expected to remain unchanged for the sixth consecutive meeting.

The monetary policy statement and comments from Christine Lagarde are expected to provide further strong clues about the path of European interest rates this year, especially amid speculation pointing to a renewed acceleration in inflation due to rising global energy prices.

European interest rates

Money markets price the probability of the European Central Bank cutting interest rates by 25 basis points tomorrow Thursday at 5%.

Amid rising global energy prices, data from the London Stock Exchange Group (LSEG) suggests the European Central Bank is expected to raise interest rates in June.

US dollar

The dollar index fell by less than 0.1% on Wednesday, extending losses for the third consecutive session and reflecting continued weakness in the US currency against a basket of global currencies.

Beyond profit-taking activity, the US dollar is declining as investors refrain from building new long positions ahead of the Federal Reserve’s monetary policy decision.

The Federal Reserve is expected to keep interest rates unchanged for the second consecutive meeting, while providing further commentary and projections that will shape the path of US monetary policy this year.