Oil prices experienced a decline in early trading on Friday, driven by optimism surrounding the potential resolution of the Middle East conflict. This sentiment follows the implementation of a 10-day ceasefire between Lebanon and Israel, alongside President Donald Trump’s indication that the U.S. and Iran may engage in discussions over the weekend. Brent crude futures experienced a decrease of $1.34, representing a decline of 1.35%, settling at $98.05 per barrel at 0021. U.S. West Texas Intermediate crude futures declined by $1.65, representing a decrease of 1.74%, settling at $93.40 per barrel, thereby reducing the gains observed in the prior session.

In a significant development regarding negotiations aimed at resolving the Iran conflict, which has resulted in the closure of the Strait of Hormuz for seven weeks and disrupted approximately one-fifth of global oil supply, Trump indicated that Tehran has proposed a commitment to refrain from acquiring nuclear weapons for a duration exceeding 20 years. We are poised to observe the forthcoming developments. “But I think we’re very close to making a deal with Iran,” Trump told outside the White House on Thursday.

Oil prices surged by 50% in March during an unprecedented rally and have only recently dipped below the $100 per barrel threshold, yet they have remained within the $90 range for the week. Israel’s military operations in Lebanon have significantly hindered the attainment of a peace agreement that Trump is pursuing to conclude the conflict with Iran, which he initiated alongside Israel in late February.

U.S. and Iranian negotiators have moderated their aspirations for a comprehensive peace agreement and are now pursuing a temporary memorandum aimed at averting a resurgence of hostilities, according to sources who spoke to Reuters on Thursday. Analysts estimate that approximately 13 million barrels per day of oil flow have been disrupted due to the closure of the Strait.