Military action against Iran does not appear necessary, says US President Donald Trump

Efforts to end the Iran war have "positive momentum", according to US President Donald Trump, Bloomberg reported on Monday. Trump said additional strikes on Iran would not be needed, although the US remained “locked and loaded.”

Describing Iran’s military position, Trump said: “Iran, militarily, is effectively over,” and added: “We’re just keeping it the status quo, and we’re doing that really at the behest of countries that are their neighbors,”

After the Republicans’ midterm election defeat highlighted the conflict’s deep unpopularity, Trump’s comments signalled that he was bringing it towards a close.

TMGM Analysis: Financial Market News, Economic Calendar & Market Insights

Qatar, Saudi Arabia, the UAE, Bahrain, Kuwait and other countries favour maintaining the status quo, the US naval blockade and the new Iron Gate land effort, the US President said.

Washington was also urged to stop issuing false reports on negotiations by Mohsen Rezaei, Secretary of Iran’s Supreme National Security Council. Arguing that the war had severely damaged the US government, Rezaei said Washington should now accept the seven conditions repeatedly outlined by Iran.

Diplomatic talks between Washington and Tehran are the focus of a fresh proposal from Qatar and Pakistan, according to sources cited by Al Hadath. Under the proposal, Iran could enrich uranium domestically up to 3.67%, a ceiling Tehran has reportedly agreed to. The United States has also offered, as part of a potential agreement, to release between $6 billion and $9 billion in frozen Iranian assets in return for a deal.

WTI Oil: Key Questions Answered

What Makes WTI Oil a Global Benchmark?

Among the three major varieties of crude oil traded internationally are West Texas Intermediate, abbreviated as WTI, Brent and Dubai Crude. Relatively low gravity and sulphur content earn WTI the descriptions “light” and “sweet”, respectively. This high-quality oil is regarded as easy to refine. Produced in the United States, it is distributed through the Cushing hub, known as “The Pipeline Crossroads of the World”. WTI serves as an oil-market benchmark, with its price regularly cited by the media.

What Determines WTI Oil Prices?

Supply and demand underpin WTI oil prices, as they do those of other assets. Stronger global growth can lift demand, while weaker growth can have the reverse effect. Supply disruptions arising from political instability, wars or sanctions can also affect prices. Another major influence is the production policy of OPEC, a grouping of leading oil-producing countries. Since oil is traded mainly in US Dollars, the currency’s value also matters for WTI crude oil: a weaker US Dollar can make oil more affordable, whereas a stronger one can make it less affordable.

Why Do Inventory Reports Matter for WTI Oil Prices?

WTI oil prices respond to weekly inventory figures from the American Petroleum Institute (API) and the Energy Information Agency (EIA), as changes in stockpiles signal shifts in supply and demand. Falling inventories can point to stronger demand and push oil prices higher; rising stocks can indicate greater supply and weigh on prices. The API releases its report each Tuesday, followed by the EIA the next day. The two sets of figures are generally close, with a difference of no more than 1% in 75% of cases. As the EIA is a government agency, its data is regarded as more reliable.

How Can OPEC’s Decisions Move WTI Oil Prices?

Production quotas agreed by OPEC (Organization of the Petroleum Exporting Countries) often influence WTI oil prices. The group comprises 12 oil-producing nations, which jointly set member countries’ quotas at meetings held twice a year. Lower quotas can restrict supply and lift oil prices, while increased OPEC production has the reverse effect. The broader OPEC+ grouping brings in ten additional non-OPEC members, with Russia the most prominent.