WTI crude oil prices plummeted on Monday, closing down 10.28% to a 1.5-week low, while RBOB gasoline fell 9.42% to a one-week low. The sharp decline followed President Trump’s decision to postpone military action against Iran, which initially sparked a brief rally in oil prices over the weekend. The geopolitical tension surrounding the Strait of Hormuz, a critical oil transit route, continues to weigh heavily on market sentiment, particularly as Iran threatens to mine the Gulf in response to U.S. actions.

The energy sector is grappling with a complex landscape, as OPEC+ plans to increase production amid ongoing production cuts due to the Middle East conflict. Goldman Sachs has warned that sustained disruptions could push crude prices above $150 per barrel, reminiscent of 2008 highs. Additionally, rising floating storage levels of Russian and Iranian crude indicate oversupply pressures that could further depress prices.

Market participants should closely monitor geopolitical developments and OPEC+ production strategies, as these factors will significantly influence oil price trajectories in the coming weeks.

Source: nasdaq.com