Crude dips as Trump plans to free ships in Hormuz
What's the story
Oil prices have witnessed a dip following US President Donald Trump's announcement of an initiative to free ships stranded in the Strait of Hormuz. The move comes as part of "Project Freedom," which will primarily focus on evacuating civilian vessels flagged by non-conflict countries from the waterway. However, the absence of a US-Iran peace deal continues to keep oil prices above $100 per barrel.
Market impact
Brent traded marginally lower at $101.94 per barrel
On Monday, Brent July futures traded marginally lower at $101.94 per barrel and US West Texas Intermediate (WTI) futures declined 0.15% to settle at $108.33. The price adjustments come as peace talks between the US and Iran remain stalled with both sides unwilling to compromise on their respective demands, keeping oil prices elevated.
Production strategy
OPEC+ plans output increase, but US-Iran war impacts Gulf supplies
The Organization of the Petroleum Exporting Countries and their allies (OPEC+) have announced plans to raise oil output targets by 188,000 barrels per day in June for seven members. However, this increase could be largely theoretical as long as the US-Iran war continues to disrupt Gulf oil supplies through the Strait of Hormuz. The move comes after a key member, the United Arab Emirates, exited OPEC on May 1.