Oil plummets 9% to closes at lowest level in one week

Oil drilling rigs

Oil prices fell today, July 27, to close at their lowest level since July 17, after the US suspended strikes against Iran over the weekend, boosting hopes that the two sides might return to the negotiating table.

The US Ambassador to the United Nations, Mike Waltz, said in media statements that President Donald Trump decided to suspend US strikes to allow more time for diplomatic efforts.

For his part, Trump announced today that the US is having "good talks" with Iran, and that there is a "good chance something will happen" regarding reaching a possible agreement, but at the same time he threatened to return to "strong military action" if diplomacy fails.

The uncertainty of the geopolitical situation reflected in the oil market outlook, with analysts predicting continued volatility as they monitor developments in the de-escalation process, while actual supply movement through the Strait of Hormuz remains limited, Reuters reported.

Separately, reports indicate that Kazakhstan cut its daily oil production by more than half after the main export terminal of the Caspian Pipeline Consortium in the Black Sea shutdown due to drone attacks.