Oil And Gas Prices Have Fallen Sharply
- 6.05.2026, 18:34
On the news of the US-Iran deal.
Oil and gas prices in Europe fell 10% or more on Wednesday after reports emerged that the US and Iran are discussing a memorandum of understanding to end a conflict that has lasted more than two months.
North Sea Brent cheapened in trading to $97.18 a barrel, having ended the previous session at $107.99 (-10%). The price corrected slightly after Donald Trump warned that the US will resume bombing Iran "with much greater force and intensity" if it does not agree to a deal. By 6 p.m. Minsk, the decline was -7.4 percent ($101.75 a barrel). A week earlier, the price exceeded $125 as the conflict escalated.
European gas futures (Dutch TTF) fell 13.2% to €40.7/MWh. After correction, the price was at 44.1 euros (-6.1%), or $549 per 1,000 cubic meters. The sharp drop in energy prices was triggered by reports that the warring sides are discussing a 14-point agreement that should end the fighting and open the way for 30-day talks on a more detailed agreement to curb Iran's nuclear program and lift some of the U.S. sanctions on it. In addition, and of particular importance to markets, the gradual resumption of shipping through the Strait of Hormuz is planned during this month.
The US will end the military campaign and lift the blockade of the Strait of Hormuz "assuming Iran agrees to implement the agreements reached, which may be a very bold assumption," Trump wrote.
The early opening of the strait was urged Wednesday by Chinese Foreign Minister Wang Yi in a meeting with his Iranian counterpart. Beijing is seeking to act as a peacemaker to bring a quicker end to the global energy crisis days ahead of Xi Jinping's scheduled meeting with Trump.
"We're still moving toward de-escalation and toward ending the conflict," Michael Brown of investment firm Pepperstone told Bloomberg. While it's not an easy path, as long as the conflicting parties remain on it "and the direction of travel remains more optimistic," market appetite for risk remains high, he added. Energy markets, on the other hand, are trending lower.