Oil fell to US$90 and hits its lowest point in over two months

The international price of oil registered a sharp drop this Tuesday, November 10, falling below the USD 90 per barrel mark for the first time since August 31. The decline occurred after U.S. President Donald Trump hinted at possible progress towards ending the conflict with Iran and announced that, for the moment, he would avoid new military attacks.

The movement reduced crude oil prices to their lowest levels in over two months and triggered an initial positive reaction in major international stock markets.

Brent fell below USD 90 and WTI also declined

Brent oil, a benchmark for European markets and the Argentine energy sector, traded near USD 89.16 per barrel, with an intraday drop of approximately 3.7%.

Meanwhile, West Texas Intermediate (WTI), the main U.S. benchmark, fell to approximately USD 83.88.

Both contracts accumulated a significant decline compared to recent highs. Brent had surpassed USD 118 in previous weeks amid fears of energy supply disruptions.

However, prices recovered some of their losses during the day. In a later update, Reuters reported Brent at USD 91.69 and WTI at USD 86.19.

Trump hinted at a possible de-escalation of the conflict with Iran

The U.S. president spoke on Monday after holding talks at the White House with Qatari Prime Minister Mohammed bin Abdulrahman Al Thani.

Trump stated that he observed progress towards a possible end to the confrontation and expressed hope for a relatively soon resolution.

He also announced that he would not order new military attacks against Iran for the time being, after receiving calls for moderation from various countries in the region.

However, Washington will maintain its naval blockade, while economic sanctions will remain in effect.

The situation remains uncertain. Mohsen Rezaei, a senior Iranian security official, stated that there are currently no negotiations between Tehran and Washington, a statement that limited market optimism.

International stock markets reacted to the energy drop

The reduction in oil prices initially boosted stock markets.

The South Korean Kospi rose 4.4%, while the Japanese Nikkei recorded a 2.9% increase. In Europe, major indices also started the day in positive territory.

Wall Street came off a Monday of strong gains: the Nasdaq had increased by 2.7%, its best daily performance in over three months.

For investors, a potential reduction in tensions in the Middle East would lower the risks of supply disruptions and ease energy costs.

U.S. inflation complicates Federal Reserve decisions

The initial optimism coincided with the release of new U.S. economic data.

October inflation rose 0.4% month-on-month, compared to 0.6% recorded in September, according to the Bureau of Labor Statistics.

Although the indicator showed a slowdown, it exceeded the 0.3% expected by analysts.

This data increased expectations for new interest rate hikes by the Federal Reserve, whose next meeting is scheduled for December.

The possibility of a more restrictive monetary policy introduced new concerns on Wall Street, as high rates can reduce consumption, investment, and energy demand.

What impact could the drop in oil have on Argentina

The price of Brent is a fundamental reference for hydrocarbon-producing companies in Argentina, particularly those developing export projects.

A lower international price may reduce expected revenues from crude oil sales, although it could also moderate fuel and transportation costs.

The effect on internal prices is not automatic and depends on additional factors, such as taxes, refining costs, and the commercial policy of oil companies.

For now, markets remain attentive to upcoming decisions from Washington and Tehran. As long as there is no confirmed agreement, oil will continue to be exposed to strong fluctuations related to the evolution of the conflict and supply security in the Middle East.