Oil prices staged a sharp rebound on Wednesday, climbing more than 2% after U.S. President Donald Trump threatened to resume bombing Iran, casting doubt on the fragile peace deal. West Texas Intermediate crude rose 1.9% to $77.51 per barrel, while Brent crude gained 1.9% to $80.38 per barrel, though both remain near three-month lows.
The renewed tensions come as the preliminary U.S.-Iran agreement—whose terms remain undisclosed—extends a fragile ceasefire by 60 days to allow for further negotiations. Industry officials caution that even if a permanent truce is reached, a full recovery to pre-war production and refining levels could take weeks, months, or longer.
Meanwhile, the International Energy Agency (IEA) issued a stark warning in its first assessment of 2027, projecting global oil supply could surge by 8 million barrels per day while demand grows by only 2 million bpd. This potential oversupply could weigh on prices in the medium term, even as geopolitical risks provide short-term support.
On the inventory front, U.S. crude stocks fell by 8.3 million barrels in the week ended June 12, according to American Petroleum Institute data cited by market sources, providing additional upward pressure on prices.
Gold Steady as Markets Eye Fed Decision
Gold prices held steady on Wednesday as investors awaited the Federal Reserve's first policy decision under new Chair Kevin Warsh, who succeeded Jerome Powell last month. The Fed is scheduled to release its rate decision, policy statement, and updated economic projections at 2 p.m. EDT, followed by Warsh's press conference 30 minutes later.
Spot gold hit a near six-month low last week as inflation concerns linked to the Iran conflict fueled expectations of higher U.S. interest rates. While gold is traditionally viewed as an inflation hedge, elevated rates tend to pressure the metal because it pays no yield. Prices later rebounded after the U.S. and Iran reached a framework deal, though Trump stressed the agreement is not final and warned he could resume military action.
At the time of writing, COMEX gold was up 0.4% at $4,372.67 per ounce, while silver gained 1.0% to $70.750 per ounce. Analysts note that any hawkish signals from Warsh could weigh on gold, which remains highly sensitive to interest rate expectations.
Base Metals Mixed
Among base metals, three-month copper on the London Metal Exchange was largely unchanged at $13,801.38 per ton, while aluminum edged 0.7% higher to $3,417.93 per ton, reflecting cautious investor sentiment amid geopolitical uncertainty.
For more on related market movements, see our coverage of Energy Stocks Surge as Crude Oil Rebounds 20% on Renewed US-Iran Tensions and Gold Rebounds from Two-Week Low as June CPI Miss Fuels Fed Rate Pause Bets.
This article is for informational purposes only and does not constitute financial advice.
