Oil Slumps to $96 as Trump Suspends Planned Strikes on Iran Energy Infrastructure

• Tehran denies US’ announcement of ongoing talks 

•Goldman Sachs sees Brent at $110 in March, April 

•LNG exports plunge to 6-month low

Emmanuel Addeh in Abuja

Oil prices tumbled yesterday after President Donald Trump said the U.S. and Iran had productive talks about ending the war and that he ordered a five-day halt on strikes against key energy infrastructure in the country.

Brent crude oil sank by as much as 14 per cent to $96 a barrel, having traded for as high as $114 earlier in the day, raising the hope that domestic fuel costs in Nigeria might also decrease, while West Texas Intermediate (WTI) was at $88.1 per barrel as of 10pm Nigerian time last night.

Also, Britain’s FTSE 100 rose 0.6 per cent after the US president’s post on his Truth Social platform, while the S&P 500 on Wall Street surged by as much as 1.8 per cent.

Trump issued an ultimatum to Iran over the weekend, giving Tehran 48 hours to reopen the Strait of Hormuz. However, on Monday morning he said that over the past two days Iran and the US had “very good and productive conversations regarding a complete and total resolution of our hostilities in the Middle East”.

He said: “Based on the tenor and tone of these in depth, detailed, and constructive conversations, which will continue throughout the week, I have instructed the department of war to postpone any and all military strikes against Iranian power plants and energy infrastructure for a five-day period, subject to the success of the ongoing meetings and discussions.”

Trump’s announcement that he was holding off on his plan to hit Iran’s grid abruptly reversed a plunge in global markets. Iran has effectively closed the key Strait of Hormuz, through which about a fifth of global oil and liquefied natural gas flows.

Trump has demanded Iran open the strait, but Tehran says it will not do so until the United States and Israel call off their attacks.

One of the sources, briefed on Israel’s war plans, said Washington had kept Israel informed of its contacts with Tehran, and that it was likely to follow Washington in suspending any targeting of Iranian power plants and energy infrastructure.

More than 2,000 people have been killed in the war the U.S. and Israel launched on February 28.

Iran Denies Any Ongoing Talks with US

However in a riposte, Iran denied that it had engaged in negotiations with the United States and President Trump.

Iran’s powerful Parliament Speaker Mohammad Baqer Qalibaf said on X that there had been no such talks with the United States, and ridiculed the suggestion as an attempt to rig the financial markets.

“No negotiations have been held with the U.S., and fake news is used to manipulate the financial and oil markets and escape the quagmire in which the US and Israel are trapped,” he wrote.

“Iranian people demand complete and remorseful punishment of the aggressors. All Iranian officials stand firmly behind their supreme leader and people until this goal is achieved,” he added.

Also, Iran’s elite Revolutionary Guards said they were launching fresh attacks on U.S. targets, and described Trump’s words as “psychological operations” that were “worn out”.

“The contradictory behavior of the U.S. president does not cause us any negligence on the war front or the continuation of the battle with the hostile enemy,” the Guards said in a statement.

Although there was no immediate confirmation that talks had already taken place as described by Trump, there were indications of outreach, with third countries acting as potential mediators or helping to set up contacts, Reuters reported. Iran’s foreign ministry described initiatives to reduce tensions, without giving further details.

A Pakistani official and a second source said talks on ending the war could be held in Pakistan as soon as this week. The Pakistani official said U.S. Vice President JD Vance, as well as Witkoff and Kushner, were expected to meet Iranian officials in Islamabad. A second Pakistani official said Islamabad was relaying messages between the United States and Iran.

Goldman Sachs Sees Brent at $110 in March, April

Goldman Sachs sharply raised its oil price forecasts on Monday, expecting Brent to average $110 in March and April, up from a previous forecast of $98, or a 62 per cent jump from the 2025 annual average. The bank also upgraded its WTI estimates to $98 in March and $105 in April.

“Assuming that Hormuz flows remain at 5 per cent (of normal flows) through April 10, prices are likely to trend higher over that period,” Goldman analysts said, adding that governments’ recognition of the risks surrounding concentrated supply and limited spare domestic capacity could further lead to greater stockpiling and long-dated prices.

Should Hormuz flows remain at 5 per cent for 10 weeks, daily Brent prices will likely exceed their 2008 record level, Goldman said. Brent crude hit about $147 per barrel in July 2008 before collapsing to around $40 within months as the global financial crisis crushed demand.

Iranian state media insisted that Tehran would allow safe passage through the strait for all shipping except vessels linked to “Iran’s enemies.”

Fatih Birol, the Executive Director of the International Energy Agency (IEA), warned Monday that the situation in the Middle East is “very severe” and far worse than the two oil shocks in the 1970s as well as the impact of the Russia-Ukraine war on gas , put together.

IEA member nations on March 11 agreed to release a record 400 million barrels of oil from strategic stockpiles to address the supply disruption triggered by the Iran war.

The IEA chief said he had been consulting with governments in Asia and Europe on releasing more stockpiled oil “if necessary,” while stressing that the most important solution would be “opening the Hormuz Strait.”

LNG Exports Plunge to 6-Month Low

Worldwide LNG exports have plunged in the past week to a six-month low as Middle Eastern supply collapsed with the de facto closed Strait of Hormuz and the outage at the world’s biggest LNG complex in Qatar.

Global LNG shipments have slumped to about 1.1 million tons over the 10-day moving average, down by 20 per cent since the war began, a Bloomberg analysis of Kpler vessel-tracking data showed.

Qatar is the primary driver of the lost LNG supply following the halt of production and exports. Supply is also lost from the United Arab Emirates (UAE), whose shipments are choked and unable to move past the Strait of Hormuz. 

At the end of last week, Qatar’s state firm QatarEnergy said the damage from Iranian missile strikes on the Ras Laffan LNG complex, the world’s single largest LNG-producing facility, would cost it about $20 billion per year in lost revenue and to take up to five years to repair.

The Iranian missile attacks on Ras Laffan Industrial City (RLIC) last week dashed hopes of quick resumption of Qatari LNG flows even if the Strait of Hormuz were to open to unimpeded and safe traffic today, oilprice.com said.

None of the other major LNG exporters, including the top exporter, the United States, can offset the lost Qatari supply, which sent European benchmark gas prices and Asia’s spot LNG prices to multi-year highs.

Netanyahu: Trump Sees Chance of Deal with Iran

Israeli Prime Minister Benjamin Netanyahu yesterday said that he had spoken with Trump, who sees a chance of reaching a deal with Iran.

The US president believes it is possible to leverage “the mighty achievements obtained by (the Israeli military) and the US military to realise the goals of the war in an agreement, an agreement that will safeguard our vital interests,” Netanyahu said in a video statement released by his office.

“In parallel, we continue to attack both in Iran and Lebanon,” said Netanyahu, adding: “We are methodically dismantling the missile programme and the nuclear programme and continue to hit Hezbollah hard.” Netanyahu also claimed that “just a few days ago, we eliminated two more nuclear scientists.”

Besides, the Israeli military has said it would continue to conduct strikes in Iran until they receive instructions to the contrary.