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Oil prices fall to two-month lows as easing Iran tensions and US inflation weigh on demand outlook
Oil prices extended their losses on Tuesday, November 10, falling to their lowest levels in more than two months as Washington signaled a reduced likelihood of further military strikes against Iran, easing concerns about prolonged disruptions to Middle Eastern supplies.
Stronger-than-expected US inflation data added pressure, reinforcing expectations of another Federal Reserve interest rate increase in December.
Price overview
As of 17:03 GMT, brent crude futures traded near $90.67 per barrel, declining approximately 2.05%.
US West Texas Intermediate (WTI) crude futures traded around $85 per barrel, down approximately 2%.
Both benchmarks extended Monday's sharp selloff, when Brent plunged 5.85% as geopolitical risk premiums continued to unwind.
Iran tensions ease
US President Donald Trump indicated that additional military action against Iran was unnecessary for now, although Washington would maintain its naval blockade of the Strait of Hormuz.
The remarks encouraged expectations of diplomatic progress, despite continuing attacks on commercial shipping and uncertainty surrounding negotiations.
The strait remains a critical passage for global energy supplies, making any further escalation a significant risk to prices.
Supply concerns return
Meanwhile, increased production from OPEC members, particularly Saudi Arabia, Kuwait and Iraq, has reinforced concerns about a potential global supply surplus.
Recovering Middle Eastern exports have added pressure to prices as traders reassess the balance between supply and demand.
US inflation adds pressure
October's US inflation figures exceeded expectations, strengthening the case for further monetary tightening.
Higher borrowing costs could weaken economic activity and fuel consumption, adding another obstacle to an oil market already facing improving supply conditions.
Market outlook
Brent faces immediate support near $89, followed by $88, while resistance stands around $92.50.
The direction of prices will depend largely on developments involving Iran, with any renewed disruption to regional oil shipments potentially reversing the recent decline.
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