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Doubts Ahead of the US - Iran Meeting Trigger Directional Uncertainty in the Oil Market
Crude Oil Focus:
The IEA cuts its global oil demand forecast for 2026 and warns of a large supply surplus in 2027.
A ceasefire agreement has been signed by the US President and Iran, and the Strait of Hormuz will be reopened soon, says Pakistan’s PM.
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Thursday, June 18, 2026 — Oil prices this morning are seen moving bearish, pressured by sentiment following the release of the pessimistic IEA forecast and the signing of the ceasefire agreement by the US President and Iran. Even so, Trump’s threat to act again has sparked doubts about an official US - Iran meeting in Switzerland this Friday, which remains a positive catalyst supporting prices.
In the June Oil Market Report released on Wednesday, the EIA again cut its global oil demand forecast for 2026, down by 1.1 million bph, or 700,000 bph lower than the previous estimate. This weaker projection comes as the IEA assesses that the potential reopening of the Strait of Hormuz could restore oil flows from the Persian Gulf. The IEA also warns that global oil supply could increase by about 8 million bph to 110.3 million bph in 2027, as production recovers in the Middle East’s eastern Gulf and OPEC+ production targets rise.
Also weighing on prices, the ceasefire agreement document was signed on Wednesday night by both US President Donald Trump and Iranian President Masoud Pezeshkian, according to an official statement from the White House. As a first step, Tehran will soon reopen the Strait of Hormuz and the US will immediately lift the naval blockade, said Pakistan’s Prime Minister Shebhaz Sharif, who helped mediate talks between the two sides.
Even so, Trump said the signed deal is not final, and the US could attack Iran again if it does not like the final agreement to be signed in Switzerland on Friday — whose details have not yet been released. Trump also reiterated that the US is not investing in Iran, following earlier reports that the US is prepared to allow investment funds for Iran in exchange for Tehran’s approval of a final settlement.
Meanwhile, a report released late Wednesday by the EIA showed that US crude oil inventories fell by 8.26 million barrels in the week ending June 12, exceeding the initial expectation that stocks would decline by 4.6 million barrels. The drop also marked the largest since February. Gasoline stocks were also reported to have fallen by 906,000 barrels. The EIA report suggests strong demand in the US oil market.
From a technical perspective, oil prices could meet nearby resistance at the $77 per barrel level. However, if negative catalysts emerge, prices could fall to the nearest support at $72 per barrel.