Energy Storm Abruptly Stops. Oil Prices Plunge 27% Into Correction, US ‘Strong Cooling’ Triggers Chain Reaction

TradingKey - The United States, Japan, the G7, and others have taken steps to forcefully cool down oil prices, triggering a maximum drawdown of up to 27% in crude oil prices.

On March 10 (GMT+8), the intense energy storm came to an abrupt halt, and crude oil prices underwent a major correction. Among them, WTI crude ( USOIL ) saw a maximum drawdown of up to 27%, briefly breaking below the $80/barrel mark. Currently, crude oil has rebounded to $85, with the drawdown narrowing to 22%, entering a state of consolidation and correction.

WTI Crude Oil Price Chart, Source: TradingView

Yesterday, the deteriorating situation in the Middle East pushed international oil prices soaring, with WTI crude rising to near $112. In the face of skyrocketing oil prices, countries and institutions led by the United States took mandatory cooling measures to suppress prices.

First, the United States hinted that the war with Iran is essentially over and will lift oil-related sanctions. U.S. President Trump stated in a phone interview, "I think the war is basically over, pretty much. They (Iran) have no navy, no communication system, and no air force." Furthermore, Trump also stated at a press conference, "The U.S. will temporarily lift some oil-related sanctions to ensure adequate oil supply and lower oil prices."

In addition, Japan announced this Monday that it has requested oil reserve agencies to prepare for the release of oil reserves. The G7 also held an emergency meeting, stating they are "ready at any time" to release 300 million to 400 million barrels of oil reserves. At the same time, Eurogroup President Pierrakakis stated, "We are prepared to take necessary measures, including the mobilization of strategic oil reserves."