Oil prices slumped in the early trade on Thursday, after Israel and Hamas consented on the first phase of a plan to conclude the war in Gaza, which impacted the war risk premium of oil and compelled investors to sell.
Brent crude futures dropped 51 cents, or 0.77 percent $ to 65.74 a barrel by 0002 GMT. U.S. West Texas Intermediate Crude fell by 55 cents or 0.88 percent to a value of $62.
U.S. President Donald Trump stated that a long-awaited agreement between Israel and Hamas on a ceasefire and freeing of hostages in Gaza under a plan to end the two-year-old war in the Palestinian enclave.
Israeli Prime Minister Benjamin Netanyahu indicated that he will call a government meeting on Thursday to ratify the ceasefire agreement.
The oil prices have been supported by the war in Gaza because the investors have considered the potential risk to the global supply of oil in case the war escalates into a larger regional conflict.
The prices had risen by approximately 1 percent to the highs of the week on Wednesday, when investors saw stalled developments in a Ukraine peace agreement as sustaining sanctions against Russia.
According to the Energy Information Administration on Wednesday, in the meantime, the proxy of U.S. oil consumption is total weekly U.S. petroleum products supplied, which increased last week to 21.990 million barrels per day, the highest figure since December 2022.
