U.S. West Texas Intermediate (WTI) crude futures fell more than 2% on May 19. President Trump paused a planned military strike against Iran to allow for negotiations. This move eased geopolitical tensions that had kept energy markets on edge.
The de-escalation pulled back the risk premium built into oil prices. The WTI July contract dropped 2.02%. This contract reached a price of $102.34 per barrel. The front-month contract declined 1.42%. This contract settled at $107.12.
Previous sessions were volatile due to uncertainty surrounding the Iran conflict. Markets remain focused on potential impacts to the Strait of Hormuz shipping lanes.