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Doubts Ahead of US - Iran Meeting Spark Oil Market Uncertainty
Crude Oil Focus:
IEA cuts its forecast for global oil demand in 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 soon be reopened, says Pakistan’s PM.
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Thursday, 18 June 2026 — Oil prices are seen moving bearish this morning, weighed down by sentiment after the release of the pessimistic IEA projections, and by the signing of the ceasefire agreement by the US President and Iran. Even so, Trump’s renewed threats have sparked doubts about an official US - Iran meeting in Switzerland on Friday, which becomes a positive catalyst supporting prices.
In the June Oil Market Report released on Wednesday, the EIA again cut its forecast for global oil demand in 2026, down by 1.1 million bph, or down by 700,000 bph from the previous estimate. This weaker outlook 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 warned that global oil supply could increase by about 8 million bph to 110.3 million bph in 2027, as production recovers in the Eastern Middle East 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 Prime Minister Shebhaz Sharif, who helped mediate talks between the two sides.
Even so, Trump said the agreement that has been signed is not final, and the US could attack Iran again if it does not like the final deal to be signed in Switzerland on Friday — details of which 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 on Wednesday night by the EIA showed that US crude oil inventories fell by 8.26 million barrels in the week ending 12 June, exceeding initial expectations that stocks would decline by 4.6 million barrels. The decline also marked the largest drop 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 standpoint, oil prices may encounter the nearest resistance level at $77 per barrel. However, if negative catalysts emerge, prices could fall to the nearest support level at $72 per barrel.