Oil prices fell in early trade after the White House announced a plan to guide boats out of the choked Strait of Hormuz, but then steadied as traders took a wait-and-see approach to whether the plan would work.
Brent crude futures for July, the global benchmark, were down 0.7% at $108.97 per barrel at 4.25 a.m. ET. West Texas Intermediate futures, the US benchmark, decreased by 0.62% to $97.14 a barrel.
US President Donald Trump announced the plan, dubbed “Project Freedom”, on Sunday, as fraught discussions to end the hostilities with Iran roll on. The US military will use a flurry of arsenal and thousands of service members to free vessels stuck in the Strait, according to CENTCOM.
Tehran immediately rebuffed the measure, warning that any “foreign military force” will be attacked if they try to enter the channel, according to a senior military official.
Meanwhile, officials in Tehran are reviewing the US response to their 14-point proposal submitted last week. Until now, efforts to bring both parties back to the negotiating table have failed over key sticking points – including the US’ demand that Tehran surrender its nuclear stockpile and Iran’s demands that the US lift crippling economic sanctions and pay reparations for its recent attacks.
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