WTI trades lower around $66.00, downside appears further due to easing supply concerns

• WTI price struggled as supply concerns eased following the Israel-Iran ceasefire.

• President Trump said that a ceasefire came into effect and urged both countries to uphold it.

• Oil prices may receive support as Fed officials indicate an interest rate cut as early as July.

West Texas Intermediate (WTI) Oil price extends its losses for the second successive day, trading around $66.30 during the European hours on Tuesday. Crude Oil prices lose ground due to easing concerns over supply disruptions, driven by the ceasefire agreement between Israel and Iran.

On Tuesday, the Israeli government confirmed it had agreed to a ceasefire with Iran. Prime Minister Benjamin Netanyahu said that Israel achieved Iran war goals, adding that the country will respond forcefully to a breach of the truce. Iranian state media announced that Tehran had also accepted the deal, raising hopes for an end to the 12-day conflict.

However, the Israeli military warned that Iran had launched missiles toward Israel after the ceasefire took effect. US President Donald Trump said a ceasefire was now in place and asked both countries not to violate it.

Oil prices struggled as traders avoided panicking following Iran’s retaliatory strike on Al Udeid, a US military base in Qatar, on Monday. Qatar officials said that the missile barrage was intercepted and reported no casualties, as the base had been evacuated in advance. Concerns over Oil supply disruption ease as Tehran decided to avoid targeting the strategic Strait of Hormuz, a crucial chokepoint that handles approximately 20% of the world’s Oil transit.

Crude Oil prices may regain their ground due to dovish remarks from the Federal Reserve’s (Fed) officials pertaining to the policy outlook. Federal Reserve’s (Fed) Vice Chair for Supervision Michelle Bowman said on Monday that he could support a rate cut in July as risks to the job market may be on the rise. Moreover, Fed Governor Christopher Waller noted on Friday that the US central bank could start easing monetary policy as soon as next month. This is important to note that lower borrowing costs could boost economic activities in the United States (US), the world’s largest oil-consuming country, which may increase the demand and prices of crude Oil.