Today Fundamental Analysis: Oil prices drop further as supply fears ease in response to the peace deal

Oil prices extended their decline during Wednesday’s Asian session as concerns over supply disruptions in the Middle East continued to ease. Brent crude fell 1% to $76.20 per barrel, while WTI crude dropped to $72.50

The decline reflects growing confidence that oil flows through the Strait of Hormuz will remain uninterrupted following recent progress in regional peace negotiations.

Additionally, U.S. President Donald Trump criticized major oil companies for not lowering gasoline prices fast enough despite the sharp drop in crude oil prices. Trump accused companies of overcharging consumers.

U.S. stock futures were mixed on Wednesday as investors awaited earnings from Micron Technology. S&P 500 futures rose 0.2%, Nasdaq 100 futures gained 0.6%, while Dow futures slipped 0.1%.

The focus comes after a sharp selloff in technology stocks on Tuesday, which pushed the S&P 500 down 1.4% and the Nasdaq Composite down 2.2%. Semiconductor stocks were among the hardest hit.

In Asia, markets were mixed. Japan’s Nikkei 225 fell 0.6%, while South Korea’s KOSPI rebounded more than 3% after suffering a 10% decline the previous day.

Micron’s earnings report will be closely watched for insight into AI-related demand. Other key events on Wednesday include U.S. economic data on building permits and new home sales, which will offer additional clues about the health of the economy.

Gold prices extended their decline on Wednesday, falling to a near two-week low around $4,050 per ounce as a stronger U.S. dollar and rising expectations of Federal Reserve rate hikes weighed on the precious metal.

Markets have significantly increased expectations for tighter monetary policy following last week’s hawkish Federal Reserve meeting. Investors now expect at least one 25-basis-point rate hike in 2026, while Fed Chair Kevin Warsh emphasized the central bank’s commitment to price stability, even if economic growth slows.

Investors are now awaiting Thursday’s U.S. Core PCE inflation report, the Federal Reserve’s preferred inflation measure, which could provide the next major catalyst for both the dollar and gold prices.