Oil prices plummet sharply in the early morning! Major announcement from Israel! Latest statement from the U.S. Treasury Secretary

Major signals from the global energy market.

This morning (March 20) Beijing time, international oil prices plummeted sharply. WTI crude oil futures turned lower in late U.S. stock trading after initially rising over 5%. Brent crude futures narrowed their gains to 1.18%, after surging nearly 11% earlier.

On the news front, Israeli Prime Minister Netanyahu stated on the 19th that Israel will “comply” with U.S. President Trump’s request to “pause” further attacks on energy facilities. As a result, the three major U.S. stock indices narrowed their declines, with some slight gains at the close.

Meanwhile, U.S. Treasury Secretary Janet Yellen’s latest remarks also eased tensions in the energy market. She said the U.S. has not attacked Iran’s energy infrastructure and has allowed Iranian oil to continue flowing through the Gulf region. The U.S. may lift sanctions on Iranian offshore oil in the coming days. Additionally, the U.S. might release strategic oil reserves again to curb oil prices.

Crude Oil Prices Tumble

Early this morning, international crude oil prices fell sharply. WTI crude futures declined by 0.19%, after rising over 5% earlier. Brent crude futures also turned lower at one point but ultimately closed up 1.18%, at $108.65 per barrel, after nearly an 11% surge earlier in the day, approaching $120 per barrel. After the Asian market opened, WTI and Brent futures continued to decline, down 1.78% and 0.33%, respectively, at the time of writing.

According to CCTV News, Trump stated on Thursday that he has informed Israeli Prime Minister Netanyahu not to attack Iran’s energy facilities.

When asked whether he plans to lift sanctions on Iranian oil or deploy more U.S. troops in the region, Trump said he would not deploy troops anywhere and that the U.S. will take all necessary measures to stabilize oil prices.

Trump also mentioned that the U.S. needs more funds to support the war against Iran.

Subsequently, Xinhua News Agency reported that Netanyahu, during a press conference, said Israel “conducted a solo” attack on Iran’s natural gas fields and will “comply” with Trump’s request to “pause” further attacks on energy facilities.

Following these statements, the three major U.S. stock indices further narrowed their losses, with some slight gains at the close. The Dow fell 0.44%, the S&P 500 declined 0.27%, and the Nasdaq dropped 0.28%, all hitting lows not seen since November last year. During the session, the Nasdaq fell nearly 1.4%, while the Dow and S&P also declined over 1% at times.

Large-cap tech stocks in the U.S. declined collectively, with Tesla down over 3%, Nvidia and Meta down more than 1%, and Apple, Google, Amazon, and Microsoft all closing slightly lower.

Meanwhile, the U.S. Department of the Treasury announced on its website the issuance of a new general license related to Russia, allowing the sale of Russian crude oil and petroleum products loaded onto ships from March 12 onward.

Dennis Follmer, Chief Investment Officer at Montis Financial, said, “The market is eager to understand how long this oil price surge will last, which is why volatility has appeared.”

Peter Boockvar, Chief Investment Officer at One Point BFG Wealth Partners, commented, “The conflict has entered its fourth week and may not end so quickly. Even if it does, commodity prices are unlikely to return to pre-war levels.”

Scott Wren of Wells Fargo Investment Institute stated, “Market sentiment may still be somewhat negative, with further downside potential. We believe that a 7% to 10% pullback from recent highs could be a good entry point.”

Latest Remarks from the U.S. Treasury

According to CCTV International, Treasury Secretary Janet Yellen on the 19th said the U.S. has not attacked Iran’s energy infrastructure and has allowed Iranian oil to continue flowing through the Gulf region. The U.S. may lift sanctions on Iranian offshore oil in the coming days and could release strategic oil reserves again to curb prices.

Yellen stated that the U.S. has permitted Iranian oil to continue flowing from the Strait of Hormuz and explicitly used Iranian oil as a tool to lower oil prices.

“We will use Iranian oil to lower prices,” she said.

Yellen also mentioned that the U.S. can unilaterally release strategic oil reserves and may lift sanctions on Iranian oil stranded at sea, leaving room for further price suppression policies.

She noted that there are about 130 million barrels of Iranian oil at sea, which could quickly enter the market if sanctions are eased.

On monetary policy, Yellen declined to comment on ongoing investigations into Federal Reserve Chair Jerome Powell. She also mentioned that if Powell remains on the Fed Board after stepping down as Chair, it would break with historical precedent.

Meanwhile, Yellen revealed that Powell’s successor, Kevin Warsh, is making good progress in meetings on Capitol Hill, which is seen as a sign of potential personnel moves within the Fed.

The International Monetary Fund (IMF) said on Thursday that it is closely monitoring the Iran conflict and its impact on energy production, warning that sustained increases in energy prices could boost inflation globally and slow economic growth.

IMF spokesperson Julie Kozack stated at a press conference that the conflict has severely disrupted maritime transportation of oil and natural gas, pushing crude prices up by over 50%, surpassing $100 per barrel.

Kozack said the IMF has not received any emergency financing requests from member countries but is prepared to support if needed. She added that IMF officials are in close contact with finance ministers, central bank governors, and regional institutions worldwide.

She emphasized that the overall economic impact will depend on the duration, intensity, and scope of the conflict. The IMF will include relevant assessments in its latest World Economic Outlook, to be published during the IMF and World Bank Spring Meetings in mid-April.

(Source: Securities Times)