West Texas Intermediate (WTI) Crude Oil trades sharply lower on Wednesday, falling more than 10% after a temporary ceasefire agreement between the United States and Iran reduced the geopolitical risk premium embedded in prices.
The USD/JPY pair fell near the 158.30 region on Wednesday, even as the United States (US), Iran and Israel had agreed on a two-week ceasefire.
Gold (XAU/USD) gives back part of its earlier gains after rising to three-week highs on Wednesday following news of a two-week ceasefire between the United States and Iran. At the time of writing, XAU/USD is trading around $4,755, up nearly 1% on the day after touching an intraday high of $4,857.
USD/CAD trades with a downside bias on Wednesday, as the US Dollar (USD) comes under broad selling pressure following a temporary ceasefire agreement between the United States and Iran. At the time of writing, the pair is trading around 1.3847, extending losses for the third straight day.
The Pound Sterling (GBP) rallies on Wednesday, advancing for the third straight day this week, up more than 1.10% due to broad US Dollar (USD) weakness, sparked by an improvement in risk appetite following a two-week ceasefire between the US and Iran.
Commerzbank’s Thu Lan Nguyen notes that Brent prices dropped by USD 15 on news of a two‑week U.S.–Iran ceasefire and reopening of the Strait of Hormuz, but still trade near USD 95, well above pre‑war levels.
Iran's Fars News Agency reported on Wednesday that oil tankers passing through the Strait of Hormuz have been stopped after Israel breached the ceasefire, per Reuters.
BNP Paribas analysts argue that weaker demand in the Eurozone compared to 2022 is helping to contain inflation, even as supply constraints remain above historical averages.
BNY's Head of Markets Macro Strategy Bob Savage highlights that the Reserve Bank of India (RBI) left its policy rate at 5.25% with a neutral stance, citing uncertainty from the West Asia conflict.
Scotiabank strategists Shaun Osborne and Eric Theoret note that the Pound (GBP) is a strong G10 performer, gaining about 1.1% on sentiment-driven buying and pushing to the top of its late-February range.
United States EIA Crude Oil Stocks Change above expectations (0.7M) in April 3: Actual (3.081M)
MUFG’s Head of Research Derek Halpenny highlights that a two-week ceasefire between the US, Israel and Iran has sharply weakened the US Dollar as risk sentiment improves and Brent Oil falls.
