Oil Prices Fall as Trump Announces Ceasefire in Middle East

Market Reaction to Geopolitical Events - Equity markets are seemingly moving past concerns related to geopolitical events, as evidenced by Asian FX and dollar offer trends [1] - The oil market is largely discounting the recent flare-up in US-Iranian conflict, with prices falling below the June 12 level [3] - Oil traders perceive minimal risk to the market, contingent on no strikes on Iranian oil infrastructure and no disruption to the Strait of Hormuz [2] Oil Supply and Demand Fundamentals - The oil market's focus is shifting to supply and demand fundamentals, which are currently bearish [4] - Widespread expectations suggest oil supplies will outpace demand in the second half of the year [5] - Chinese demand growth has been weak in recent months, contributing to the bearish outlook [6] - OPEC plus has been agreeing to increase output more than normal, adding barrels to the market [8] - Iran has been increasing its exports, further contributing to the supply glut [8] Price Outlook - The market sentiment has swung back to a bearish view, with discussions shifting from extreme scenarios like $100 oil to potentially lower prices [6] - The $60 range is considered a likely level for oil prices, barring disruptions to the Strait of Hormuz [9] - Shale drillers potentially taking advantage of the recent price spike could add supply, putting downward pressure on prices [9]